How to Write a Loan Application Letter as a Nigerian | Example, Format, Template, & How-To Guide

When obtaining a loan, one is normally required to send a loan application letter to the bank, lender, or other financial institution. The letter is part of the application process.

Your loan may likely be granted if you include the letter as well as your financial history, how you intend to use the loan and repayment plans.

This post will discuss the components of a loan application request letter, how to write one, and provide a sample to get you started.

What is a Loan Application Letter?

A loan application letter is a well-written letter in which you express your wish to get a business or personal loan from your employer, financial institution, or corporation.

The loan application letter shows your skills, personal accomplishments, abilities, and life in general.

To be authorized, your loan application must capture the manager’s attention and highlight the main aspects that qualify you for the loan type you request.

When Is It Right to Write a Letter of Application for Loan?

A loan application letter may be required in either of two situations. In the first situation, a loan from a traditional bank lender is required. These financial institutions make loans available to the general public rather than providing them. To demonstrate their creditworthiness, candidates frequently have to apply for loans through traditional banks.

To apply for an SBA-guaranteed loan, you may be required to submit a loan application letter. This form of loan is administered by the federal government, and candidates must pass further screening before being accepted for funding. A thorough loan application with all required supporting papers may improve an applicant’s chances of securing an SBA guarantee.

A solid loan application letter can have a big impact on the approval process in both cases. The letter must be unique and contain all of the relevant details to support your loan request.

The letter must include your name, contact information, and a reason for the loan request. Furthermore, you should explain how you intend to spend the money and repay the loan.

Your loan application letter should be official, businesslike, and well-formatted with proper grammar and syntax. Tax reports, financial records, and a business strategy should all be included as supporting paperwork. These documents can help lenders verify your application and provide additional information they may need to make a judgment.

Writing a thorough and professional loan application letter that appropriately details your financial condition and loan repayment capabilities is critical.

What Should You Include in a Loan Application Letter?

A loan application letter must have a few crucial components; without these, the application will be incomplete.

#1. Individual Data

The initial section of the loan application letter should include the borrower’s personal information. It is required to include the borrower’s name, phone number, and email address. In order for the lender to contact the borrower, if necessary, the correct information must be submitted.

#2. Details about the loan

This section of the loan application letter should contain information about the loan being requested.

This statement should include the loan amount, purpose, and payback terms. The loan amount and repayment terms must be mentioned properly to ensure that everyone is on the same page.

#3. Information on employment and income

To evaluate whether or not the borrower will be able to repay the loan, the lender will inquire about their employment and income.

The borrower must supply information about their current employment status, including job title, duration of employment, and monthly wages. If the borrower works for himself, they must reveal information about their business and revenue.

See also: Simple Job Application Letter Nigerians Need to Secure a Job: Example, Format, Template, & How-To Guide

#4. Credit History

The lender will also consider the borrower’s credit history. The borrower must give information regarding previous credit accounts or loans, including their current status and payback history. Bankruptcies and foreclosures should also be notified.

If the borrower requests a secured loan, they must submit details on the collateral they are offering. This information should include a description of the collateral as well as an estimate of its value.

#5. Loan Objective

The borrower must provide a detailed description of the loan’s purpose. This could include paying off debt, making house improvements, or purchasing a car. Being precise about the loan’s purpose is critical for helping the lender understand how it will be used.

6. Repayment Schedule

Borrowers must present a complete repayment plan describing how the loan will be repaid. The payback schedule, monthly installments, and payment method should all be included in this plan. The repayment plan must be reasonable to ensure that the borrower can afford the installments.

#7. Conclusion

At the end of the loan application letter, the borrower’s financial position and loan eligibility should be explained. The borrower should submit their contact information for future correspondence and thank the lender for considering their loan application.

How to write a loan application letter

The first step in obtaining the financial assistance you seek is to prepare an effective and well-documented loan proposal, which requires an understanding of  how to write a loan application request letter.

While a company loan requires both receivables and a solid credit rating, a personal loan is often approved based on your credit score and careful financial planning.

See also: How to Write Secretary Application Letter With No Experience: Nigerians Most Ultimate Guide

How To write a loan approval letter

#1. Give basic Information

To begin writing a convincing, instructive, and communicative business loan request letter, include a header and salutation. A compelling headline summarizes the key aspects of your business loan proposal in a few paragraphs. To set the tone for the letter, include a greeting at the top. Include the following information:

  • Your name.
  • Your mailing address.
  • Name of your company.
  • The address of your business
  • The lender or loan officer’s name
  • Contact information for lenders and lending agents.
  • The subject line should include the requested loan amount.

When composing a business loan request letter, include your company’s legal name, current project status, current yearly revenue, information about your business activities, length of operation, current staff count, and turnover from the previous fiscal year.

#2. Mention the reason for the loan.

After describing the basis of your organization, elaborate on how you intend to use the loan cash. Make a compelling argument for how this investment will help your business or project.

It is critical that you demonstrate to the lender that you have evaluated the ramifications of incurring additional debt.

#3. Ensure that the loan will be repaid.

After you’ve explained how you want to spend the borrowed funds, focus on how you plan to repay the loan and the duration of the installments, including interest. Provide strong facts to back it up.

You can also use your track record of sound financial decisions to demonstrate your credit history and personal finances. Your lender will be more likely to grant your loan if you provide specific financial facts about your business.

See also: How to Write Security Guard Application Letter With No Experience: Nigerians Most Ultimate Guide

#4. Signing the letter of request for business financing

It is important to express that you will appreciate and responsibly use any business loan that your lender may provide you.

Be as courteous as possible to prevent having your application denied. A successful loan request letter can help you negotiate a lower interest rate on a company loan.

Allow your lender to understand that by ending on a positive note, offering you a loan benefits both sides. Finally, state that you would like the loan officer to analyze your application and speak with you as soon as feasible. Then sign the document.

Tips for Writing a Loan Request/Application Letter

Make sure your loan request letter is well-written, serves its goal, and makes a good first impression because it will be one of the first documents the underwriter reviews as part of your application.

The following guidelines will help you write a loan request letter.

  • Review the loan requirements and ensure you understand how they apply to you. It is important that you review the guidelines, as they include eligibility criteria such as age, minimum salary requirements, and a high credit score.
  • Explain why you require the financing. Be brief and provide all necessary loan application facts.
  • Please send any supporting documents. Have your document designed by a specialist. If writing does not come naturally to you, consider working with an editor or copywriter.
  • Determine how much you’ll need. Describe the loan amount you are requesting. Then outline the repayment plan. Let’s imagine you wish to repay N13,000 over a period of five years.
  • Address the reader with courtesy and professionalism. Write simply and politely, avoiding acronyms and technical words. Make sure your proposal is easy to read, follows a business framework, and is well-structured.
  • Provide a repayment schedule. Showcase the possibilities of your venture throughout the proposal. Demonstrate that you have considered all possible possibilities and have prepared accordingly.

See also: How to Write an Application Letter for Change of Date of Birth in NIN | Example, Format, Template, & How-To Guide

Format of a Business Loan Application Letter

Mr Chris Stanley Nwangwu

President Stnley Furnishing Homes


Victor Ike

Department of Administration

XYZ Corporation. Ltd.

Application for loan to expand my business

Greetings, Mr Victor.

I am requesting a N50 million business loan to fund the expansion of my furniture firm, particularly for warehousing facilities. My company’s sales and profitability have increased considerably over the last two years, prompting me to consider expanding.

Because of my extensive expertise in the furniture sector, I could be considered an expert as well as a top marketer.

I founded Stnlay’s Furniture Homes in 1995, and it has been a success ever since. Although every industry has ups and downs, the company has grown tremendously under my guidance.

The housing sector of the economy has an impact on the furniture market, and we have many satisfied customers who have offered positive feedback on our items.

The housing market has recovered considerably in recent years, and growth over the next decade is likely to exceed pre-recession levels. To stay ahead of the market, Stnley’s Furniture makes every effort to accommodate the expanding need for furniture while also keeping up with evolving trends.

My low-cost marketing techniques generated an average of 4000 new orders per month from individual houses around the country.

I have invested approximately N25 million in the company so far, and my collateral consists of N45 million in corporate assets and N30 million in personal assets.

I’ll share my business strategy, which explains why I’m applying for the financing. For any more inquiries, please contact me at +2341647865362.


Mr. Chris Stanley

Format of Personal Loan Application Letter

If you’re seeking for a loan for personal reasons, follow the method below. In this case study, the customer service representative requests a loan to pay for his children’s schooling expenses.

Mr. John James

Customer Service Officer

Finance Team


Mr. Bruno Mars

Head of the Department of Administration

BCV Corporation. Ltd.

Application for Loan for Children’s School Fees

Greetings, Mr. Bruno.

I humbly request a N250,000 personal loan to pay for my children’s education expenses. I was meant to have paid the fees by now, but I was unable to do so due to a number of urgent, unforeseen circumstances.

This unforeseen occurrence reduced the money I had set aside for my children’s education, and I had planned to ask you for a loan to cover the difference.

Since I have been with the firm for more than five years and have demonstrated the utmost commitment and attention to the organization throughout that time, it is no surprise that I believe you will consider my loan request and find me deserving of receiving the loan.

You are free to select or recommend a repayment schedule for me as an employee of this organization.

I appreciate your time and hope to hear from you shortly.


John James

See also: How to End an Application Letter Perfectly | Closing Examples & Tips

How To Write An Application Letter For A Credit Officer

For example;

I just happened to pass by the bank and noticed that you were looking for a credit officer. If you were to consider me for the position, I would be quite grateful. I’ve uploaded copies of my reference letters and resume here. I believe you will be more than pleased with my portfolio.


Writing a letter of application is an important step in the loan application process. It is important that you provide accurate and detailed information about your financial condition and the loan you want.

You can write an excellent loan application letter by following the instructions in this article. This increases the likelihood of you receiving a loan.


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