While every loan program is slightly different and will have different forms required for application, you will likely need to submit much of the same information for any loan application so it’s best to begin to compile everything right from the start.
According to the Small Business Administration (SBA), these are the typical documents you should have ready for your first visit with a banker:
- Personal Background – Either on the loan document or separately, you’ll be asked to provide personal background info such as previous addresses, educational background, maiden name, etc.
- Resume – some lenders require some business experience as part of the application especially in startups or acquisitions.
- Business Plan – all loan programs require a solid business plan that includes a complete set of financial statements and market data
- Personal Credit Report – It’s wise to get a copy of your personal credit report from a free credit report site before you make application. This gives you the opportunity to fix errors or be prepared to explain negative entries. The lender will order their own copy as you make application
- Business Credit Report- If you are already in business, you may be required to submit a credit report for your business. As with your personal report, it is wise to know what is on it before making application
- Personal Financial Statements – Most lenders will require you to state your personal financial holdings with this form. Any partner owning more than 20% of the business will usually be required to submit similar statements and sign the guarantee.
- Income Tax Returns – Almost all lenders will require at least 3 years of both personal and business tax returns. Have them ready
- Business Financial Statements – In addition to the business tax returns, lender usually will require monthly financial statements for the interim months between year end
- Bank Statements – Often lenders require 6 months to a year of bank statements to verify income.
- Legal Documents – There may be some variation here but a lender may require one or more of the following legal documents:
- Business Licenses or registrations
- Articles of Incorporation or Articles of Organization
- Shareholder or Operating Agreements
- Contracts with third parties
- Franchise agreements
- Commercial leases
Lenders appreciate entrepreneurs and business owners that are prepared and know what to expect. Gather all these forms first an make your first visit to the bank a pleasant one.
David Oetken, MBA, CPM is the Director of the Louisville Small Business Development Center. He can be reached at [email protected]