2019 Small Business Resource Guide 2019 Small Business Resource Guide | Page 10

S TA R T I N G A B U S I N E S S
Income Tax Returns Legal Documents
Most loan programs require applicants to submit personal
and business income tax returns for the previous three years. Depending on a loan’s specific requirements, your lender
may require you to submit one or more legal documents.
Make sure you have the following items in order, if
applicable:
Financial Statements
Many loan programs require owners with more than
a 20 percent stake in their business to submit signed
personal financial statements. You may also be required
to provide projected financial statements either as part
of, or separate from, your business plan. It is a good idea
to have these prepared and ready in case a program for
which you are applying requires these documents to be
submitted individually.
Many loan programs require one year of personal and
business bank statements to be submitted as part
of a loan package.
Accounts Receivable and Accounts Payable
Most loan programs require details of a business’s most
current financial position. Before you begin the loan
application process, make sure you have accounts
receivable and accounts payable (income and expenses).
Collateral
Collateral requirements vary greatly. Some loan programs
do not require collateral, or something pledged as security
for repayment, such as equipment or real estate. Loans
involving higher risk factors for default require substantial
collateral. Strong business plans and financial statements can
help you avoid putting up collateral. In any case, it is a good
idea to prepare a collateral document that describes cost/
value of personal or business property that will be used to
secure a loan.
• Business licenses and registrations required for you to
conduct business
• Articles of Incorporation
• Copies of contracts you have with any third parties
• Franchise agreements
• Commercial leases
Organizing your documents
Keeping good records is essential for running a successful
business, but even more critical when applying for a loan. All
information you provide will be verified by your lender and
the organization guaranteeing the loan. False or misleading
information will result in your loan being denied. Finally,
make sure you keep personal copies of all loan packages.
More Information
If you plan on applying for a SBA loan, check out the SBA
Loan Application Checklist at SBA.gov. If you are not
seeking a SBA Loan, many other lending institutions offer
commercial loans in Arlington such as your local bank.
Source: www.SBA.gov
@LegendzClassicBarberShop
10
11