Finance expert Louise Schofield answers your questions...

What are the best business loans available at the moment and will the credit crunch affect how banks view small business lending?

I think we would all be kidding ourselves if we thought the credit crunch will not affect business borrowing just as it has personal borrowing. However, all types of loans are still major products in the portfolios of lending institutions, and many will still want to sell them. It may mean that your proposition just has to ring a few more bells.

A comprehensive, strong and realistic business plan is the key to a successful application. In fact, the more concise and readable the plan, the better in my view. I would suggest about 12 pages long, with nine of crisp and relevant narrative and three of financial projections. The most important chapter is the one on market research. You can only begin to forecast your sales if you have spoken to your potential customers and gauged what they will buy from you, how often and how much they will pay.

Security can be a hurdle for many start ups so familiarise yourself with the Small Firm's Loan Guarantee Scheme. This is a government scheme providing a proportion of the security on a business loan. See www.businesslink.gov.uk

Nearly all small-business borrowing comes from the major high street banks and their subsidiaries and I would suggest starting by approaching your current bank. When making your application bear in mind the following mnemonic, Campari, used by many of the banks.

C = Character

• Age, history and track record of business (or owner)
• Owner's history of doing what they say they will do
• Financial acumen - are financial forecast realistic and accurate?

A = Ability

• Does the owner have the skills required to manage this business?
• Profitability - are profits sufficient to meet the liabilities as they fall due, repay borrowing and provide an income for the owner(s)?
• Product and market - is it stable or erratic? How much competition is there?

M = Means