What lenders actually look at in your accounts

Business owners tend to assume the profit and loss account is the thing being judged. It matters, but it is rarely where an underwriter starts.

Bank statements come first

Filed accounts can be eighteen months out of date by the time you apply. Six months of statements show what is happening now: the pattern of receipts, how close you run to the overdraft limit, and whether any direct debits have bounced.

Returned direct debits are the single biggest red flag

One returned payment is an administrative slip. Three in six months reads as a business that cannot forecast its own cash position, and it will cost you more in rate than a mediocre profit figure ever will.

Consistency beats size

A business turning over £40,000 a month, every month, is easier to fund than one averaging £60,000 with wild swings. Predictable is bankable.

Director conduct counts

Personal credit files of the guaranteeing directors get pulled on almost every unsecured application. A director's missed mortgage payment can sink a healthy company's application, so it is worth checking before you apply rather than after.