Small Business Loan Checklist
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When it comes to business, time really is money, and in today’s ultra-competitive climate it’s more important than ever to move quicker and smarter than competitors. With the proper preparation, applying for small business financing can be a swift, painless process. We’ve gathered a checklist of commonly asked questions and application must-haves to ensure you not only get the best possible rate, but in a timely manner.

There are a few initial questions loan providers ask when determining the type of financing program a business qualifies to receive. To prepare, gather this information before the call:

• Time in Business: The amount of time a business has been in operation does matter. “When we are focusing on business revenue and how much to lend a company, its imperative that we have an average,” says Danielle Rivelli, Sales Manager at United Capital Source. “When a business has only been open for three months or five months, or something on the more conservative side, our offers are therefore more conservative. We are going to offer a shorter term.”

• Bank and Credit Card Statements: Financing programs are typically revenue driven, so recent bank statements are very important. “We like to see the most recent business bank statements. If the business is excepting credit cards, they should know that in addition to the most recent bank statements, we would like to see the 3-4 month credit card statements as well,” she says Rivelli. “Although they generally are being transferred from the processing account to the bank account, we like to compare to make sure each individual batch is making it to the account and averages match up properly.”

• Bank Account: Be sure it’s a business account, not a personal account. Lenders look to ensure balances remain positive each month. Account statements with multiple negative months and multiple days of NSF (non-sufficient funds) will discourage lenders from approving a loan, “simply because if I am going to collect the payment, I need to make sure the money is going to be in the account to support the payment,” says Rivelli. Seasonality can be taken into consideration, however, so a business that is open seasonally should certainly make a case by providing more bank statements (up to a year) to build the strongest average.

• FICO Score: Coupled with time in business and monthly bank averages, a FICO score will allow lenders to determine of a slightly longer program or a more conservative term is appropriate. Basic applications are generally the first step in the application process; these documents help lenders identify the needs of a business at a glance.

To get through the application quickly and efficiently, be sure you have the following information available:
• Business location
• 6 months of bank statements
• 3 months of credit card statements
• Basic voided check – be sure this check is for the main business operating account, not a personal account, payroll or other such account
• Photo ID—if there is more than one owner of the business, supply photos for all owners
• Business lease (or mortgage statement if the business owns the facility) – a full lease is not required, just the basic term and signature page.

Additional Paperwork: Beyond the basic application, there may be additional paperwork for some types of finance programs and loan amounts.

Typical Additional Requirements: The following information is also needed…
• Business license
• Basic site inspection—This is generally required for any loan amount $25,000 and over
• Financials—For any loan $74,000 and over, basic year-to-date Profit & Loss, a Balance Sheet is required and your most recent yearly tax return.

Beware of Scams: This information should never be asked for by a small business loan lender:
• Bank login information should never be required. Avoid giving out this information!
• Some companies require application fees or origination fees for approval; however United Capital Source doesn’t recommend businesses pay anything up front.

Danielle Rivelli’s final piece of advice is to “be prepared and set the expectation. Always put your best foot forward, but be up front and honest with a potential lender. This allows them to work quicker and determine an accurate rate, in many cases on the initial call.”

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