16 Loan Application Letter Samples | Writing Guide (+Template)

16 Loan Application Letter Samples | Writing Guide (+Template)

At one point in your life, you will need a loan either for personal or business use from a financial institution or the bank. In the loan application letter or request letter, you should give a detailed explanation of what you intend to do with the money and a clear outline of how the loan will be used. Therefore, you need a convincing tone to appeal to your lender and a clear plan on how to use the funds for your loan to be granted successfully.

However, what should you do if you have no idea of where to start when writing this letter? This is a question as a borrower you might be asking yourself. However, worry no more as this well-curated article is a guide for writing a loan application letter and critical points to include.

Essential Elements of a Loan Application Letter

There are several guidelines you should observe when writing a loan application letter. These are;

Header and Greeting

When starting your loan application letter either for a business or personal loan, you should start with a header and greeting. In the header, go ahead and include several lines outlining the necessary exact details of your loan request. The details to include when requesting for a business loan are;

  • Your name
  • Business name
  • Business address
  • Business phone number
  • Lender’s or loan agent’s contact details
  • Lender’s or loan agent’s name and title
  • A subject line stating your desired loan amount

You should then include a greeting right below the header to start your loan application in a friendly tone.

Business Loan Request Summary

In this section, you should provide your loan agent or lender with an overview of your loan request. This includes stating the ideal loan amount, basic business details, why you are a trustworthy borrower, basic information about your business, and the use of the loan. However, it is essential to make sure this section is short and concise, detailing only vital details to make your lender quickly reach the letter’s body.

Basic Details About Your Business

You should start by making it clear your request for a loan and the amount you are looking to borrow. Consequently, write a few sentences explaining general details about your business including;

  • The legal business name and any DBA used by your business
  • The business structure
  • The duration your business has been in operation
  • An overview of what your business does
  • Number of employees
  • The business annual revenue and profits if applicable

After detailing the basics about your business, you can proceed to the next step, explaining why you need the business loan. You should also outline how you are planning to pay back the lender if granted the loan.

The Use of the Business Loan

The goal of any lender is minimizing risk as much as possible. Therefore, they will carefully scrutinize before deciding whether to approve or disapprove the business loan by assessing whether you can pay back the loan in full and on time. You should thus have a clear outline of how you intend to use the business loan and why using the granted funds is a wise investment. It is also essential to show the lender you’ve considered the accomplishments that will be brought by the granted loan.

Proof of Ability to Pay Back the Loan

You should use figures from the latest income statement or balance sheet to show your business ‘financial health. These details are crucial as they demonstrate the ability of your business to repay the loan. Moreover, you should mention additional financials on your business to prove you’re a low-risk investment. If your business is probable, make sure to mention this as this usually is seen as enough proof of your ability to pay back the loan. You should also state if your business has any existing debt and include a business debt schedule.

After doing this, you can go ahead and add particular cash flow predictions so that the lender gets an idea of your plan to pay back the principal and interest if the loan is granted.

Always Give Correct Information

For the lender, lending is a risky investment. Therefore, you should always provide right and factual details, including accurate credit history, to make sure both parties are okay with the terms of the deal. The lack of honesty when requesting for a long is considered fraudulent, meaning there will be consequences for such actions.

Sample Loan Application Letter

Applicant’s Name

Bank Account Number

Applicant’s Address

City, State, Zip Code


Name of Loan Officer

Name of Financial Institution or Bank

Address of Financial Institution or Bank

City, State, Zip Code

RE: Loan application for $100,000

Dear, (Loan Officer’s Name)

I am writing this letter formally requesting for favorable consideration of my loan request. I have been working for this bank for the last 20 years, and each month payment is sent to my checking account. Furthermore, I have a savings account, which has where I save a substantial sum every month.

Ten years ago, you granted me a loan of $10,000, which I used to start my business. I’m glad to say I completed paying for the principal and interest on time. Since then, my company has flourished, and I’m taking this opportunity to request another loan of $100,000 to build new offices in a different location in the city.

I have already selected the property, and the loan will help me make the office fully equipped to carry out business operations. Enclosed, you’ll find the loan application and all the relevant documents.

Please feel free to reach me through my email address or phone number in case of any questions. I am also open to discussing these details about this loan application in-person, including outlining the repayment schedule and by which date it is convenient for you the payments to be completed.

Thanks for setting aside your time to consider my loan request. I am looking to hear from you with a favorable response.


Applicant’s Signature

Applicant’s Printed Name

Bank Account Number

Enclosures List

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    Getting a loan is sometimes essential to handle a personal emergency or to get funds needed to ensure smooth business operations. Nevertheless, it isn’t always as straightforward to be granted a loan as lenders are wary of giving loans fearing default of payment. Therefore, reading through this article has provided you with insight on how to draft a convincing loan application letter. If you observe the steps mentioned above, the lender will not hesitate to process the requested loan amount.