How to explain your situation to a lender — on one page

Why write it down at all?

Because files that don’t fit a checklist live or die on the story.

If your business has two years of lodged returns, a clean credit file and a straightforward request, a lender barely needs to hear from you. But if there’s a default, a loss year, ATO debt, a short trading history, a past bankruptcy or a company that didn’t make it, the lender’s first reaction is a question: what happened here?

You can answer that question on the phone, in pieces, over several calls — or you can answer it once, clearly, on one page. The page wins every time. It shows you understand your own situation, it gives the lender something to put on the file, and it stops the story changing between conversations.

business.gov.au suggests presenting your financial details to a lender as a professional-looking overview. For a file with a wrinkle, this page is that overview.

What goes on the page?

Five short sections. Use headings so it’s easy to scan.

Section	What to include	Length
1. The business	Name, structure, what it does, how long it’s traded, who runs it	2–3 sentences
2. What you need	Amount, purpose, quotes or contracts, timing	2–3 sentences
3. What happened	The issue, with dates and amounts, stated plainly	3–5 sentences
4. What’s changed	Evidence the issue is resolved or managed	3–5 sentences
5. How you’ll repay	From trading, refinance, sale or other income — with a fallback	2–3 sentences

That’s it. Around 300 to 400 words. No long history, no adjectives doing the heavy lifting.

How do I write “what happened” without making it worse?

This is the section people struggle with. A few rules help:

Be specific. “In March 2024 our largest customer, a regional builder, went into liquidation owing us $86,000” is far better than “we had some cash-flow issues”.

Own it. Even when someone else caused the problem, describe your part plainly: “We relied on that customer for most of our income, and we fell three months behind on BAS as a result.”

Don’t over-explain. A lender doesn’t need every conversation with the ATO or every argument with a former partner. They need the facts that explain the listing, the loss or the debt.

Match the documents. If your credit report shows a default of $4,812 listed in August 2023, don’t write “a small default a few years ago”. Check your credit report first — the OAIC says you can get it free every three months from each credit reporting body.

Worried your situation is too complicated to explain? Tell us the short version — a real person will help you work out what matters. No credit check to enquire.

What counts as evidence that things have changed?

This section is what turns a worrying file into a workable one. Good evidence includes:

• Payment records — the default paid, the judgment satisfied, the ATO plan up to date.
• Lodgements current — BAS and returns lodged, with dates.
• Trading since — bank statements showing steady deposits over recent months.
• Structural changes — a new bookkeeper, a registered tax agent, a separate GST account, a broader customer base.
• Time — “no late payments since discharge in 2023” says a lot.

Name the documents you’re attaching so the lender can tick them off.

A worked example (illustrative)

This example is illustrative only and describes no real business.

The business. [Company name] Pty Ltd has made custom kitchens and cabinetry on the Central Coast since 2018. I’m the sole director and we employ five staff.

What we need. $140,000 to buy a CNC router (quote attached) so we can take on two builders’ volume work that we’re currently turning down (letters attached).

What happened. In 2024, a builder that accounted for most of our work went into liquidation owing us $86,000. We fell behind on two BAS and a supplier listed a $6,400 default against the company. I also had a $3,100 personal credit card default during that period.

What’s changed. We lodged the overdue BAS in January 2025 and set up an ATO payment plan, which we’ve kept every month and which has now been paid out. Both defaults were paid in full by June 2025. We now work with eleven builders, none more than a fifth of revenue, and a registered BAS agent handles lodgements. Twelve months of bank statements are attached.

How we’ll repay. From trading, with the new work covering repayments several times over based on the attached quotes. If volumes are slower than expected, equity in my home is available as a fallback.

It’s about 230 words. A lender reading it knows exactly what happened, what’s been fixed and what they’re being asked to fund.

What should I leave out?

• Blame and emotion. State facts; let them speak.
• Promises you can’t back up. “We’ll double revenue next year” without evidence reads as hope.
• Unrelated personal detail. Keep it relevant to the lending decision.
• Anything inconsistent. If it doesn’t match your documents, it undermines everything else.
• Rates or offers from elsewhere. Keep the page about your business, not a negotiation.

Which situations benefit most from a one-page explanation?

Almost any file that isn’t straightforward. In particular:

• a past default or court judgment;
• a loss year or a drop in revenue;
• a previous company liquidation or past bankruptcy;
• a recent change of industry or structure;
• ATO debt, with or without a plan.

If you’re not sure how a lender will see your situation, our situation search gives a quick, plain-English read. And our guide to what ABN Lookup shows a lender helps make sure section one matches the public record.

How do I use the page once it’s written?

1. Keep it with your documents — ID, statements, lodgements, credit report, quotes.
2. Use it on the first call so your story is consistent from the start.
3. Update it if anything changes before settlement.
4. Reuse it next time you borrow — it’ll only need a new “what we need” section.

What does a lender actually do with the page?

Knowing how it’s used helps you write it well. Typically, a lender or the person assessing your file will:

• read it first, before the documents, to understand the shape of the file;
• check it against the evidence — credit report, statements, lodgements, ABN and ASIC records;
• use it to decide which questions to ask on the phone;
• attach it to the file so anyone else reviewing it sees the same story;
• refer back to it if something comes up later in the process.

That’s why consistency matters so much. If the page says the default was paid in June and the credit report shows it updated in September, that’s fine — but mention the timing gap. If the page says you trade with eleven builders and the statements show deposits from three, expect a question.

A well-written page often shortens the whole process. Instead of a lender piecing the story together over several calls, they can move straight to the questions that matter: security, amount and timing.

Ready to tell your story to a real person?

You don’t need a perfect file to borrow — you need a clear one. A single honest page can do more for your application than a folder of documents with no explanation.

When you enquire with us, there’s no credit check at that first step, and your details aren’t sprayed around to a list of lenders. A real person reads your situation and calls you. Please be accurate on the form — including any issues you’d cover in your one-page explanation — so we can match you with a lender who’s comfortable with your story. Start your enquiry.