Coming up with the idea for a great business is often very difficult. What’s even more difficult sometimes is pitching that idea to a bank or the SBA when you go in for a small business loan. Luckily, most lenders often ask for the same information. This makes it easy for you to put together a packet with all the requisite documents and be ready to present your business idea to multiple lenders.
What Should I Have Before Applying for a Small Business Loan?
- Application Forms – The first thing you’ll need, and the only thing that may change depending where you are seeking your loan, is the application. It’s an obvious one, but people forget it all the time.
- Business Plan – This is arguably the most important document you will have. It should include everything, including projected profits and costs.
- Resumes – Many lenders will want to know that you’ve had some experience in management. Make sure to include an up-to-date resume just in case.
- Credit Reports – The lenders you apply with will no doubt run their own credit check on you, but you should do it yourself first. That way, you can dispute any errors before the lenders make a decision using incorrect information.
- Tax Returns – Most lenders will want to see your income tax returns from the last three years. Don’t forget to include them.
- Any Legal Documents – You should also include any necessary legal documents you have already acquired for your business, such as licenses, commercial leases, franchise agreements, etc.
- Collateral – Depending on the lender, you may be asked to provide collateral, especially if the lender feels your idea is high-risk. If you put together a strong business plan and financial statements, you may be able to avoid putting up collateral. Either way, it’s best to be prepared, so include some information about personal or business property you could put up as collateral.
Business formation is a long process, but it’s best to take your time and make sure everything is done right the first time.
The Manalapan business lawyers at Garland & Mason LLC are proud to have been a part of the lasting success of so many small businesses over the years.