What are the legal formalities to obtain finance from a bank/leasing company?
The essential procedure to be followed to obtain finance is similar whether from a Bank or a leasing company. Depending on the type of finance/facility (running finance, cash finance) required from the Bank, the individual concerned must submit the following initial documents to the Bank. a) Borrowers Fact Sheet b) Credit information bureau (CIB) report In case of a new business; a) A projection report b) Search report from the SECP. Incase of an existing business; a) Audited financial statements b) Inspection reports c) Evaluation Reports. Once the Bank decides to extend finance to the borrower, certain necessary legal documents need to be executed by the borrower in favor of the bank. They are as follows; a) Property Documents b) Promissory Note c) Loan contract between the bank and the customer d) Personal guarantees given by the directors/ partners / sole proprietors of the business. e) Contract between the Bank and the Customer with regard to the facility availed.
