How To Apply for a Small Business Loan: Loan Documentation Checklist

female business owner looking confused while reading small business loan paperwork

Compiling the paperwork you need to apply for a small business loan can be time consuming and challenging, especially if you aren’t sure what loan documentation you’ll need before you apply. Having all of your documents organized before you apply for funding can significantly reduce the time you spend waiting for approval. Some lenders are even able to approve and deposit funding in as little as 24 hours if you’re able to provide your loan documentation in a timely manner.

Loan documentation requirements vary based on the type of lender and the type of funding you’re applying for. Traditional lenders like the Small Business Administration (SBA) and banks have much stricter documentation requirements, requiring years of personal and business financial information, while alternative lenders like Greenbox Capital® typically ask for much less paperwork and have a faster, more streamlined process that can save you hours when compiling your loan documentation.

Our loan documentation checklist will help you understand how to apply for a small business loan, whether you’re applying for funding from the SBA or an alternative lender.

Loan Documentation Requirements for SBA 7(a) Loans

SBA loans have the most rigorous application process with the most comprehensive loan documentation requirements. Here’s what you’ll need to apply for an SBA 7(a) loan:

1. Borrower Information Form (SBA Form 1919)

This loan application form is used to profile the applicant who is seeking the loan, including details like contact information, identifying company qualities, loan intent, business principles, and an overview of previous or outstanding loans. You’ll need to submit one for anyone who owns 20% or more of your business, as well as all officers and directors, managing members, anyone who manages day-to-day operations, and any one who might be guaranteeing the loan.

2. Personal background and financial statement (SBA Form 912 and SBA Form 413)

These forms are used to ensure your personal credit is strong and verifiable, and will include a list of assets and liabilities to give your lender an idea of your current net worth and your history with investments. You’ll need to supply each of these forms for partial owners, general partners, proprietors, and managing members of your business.

3. Business financial statements

You’ll need to provide the following:

  • A profit and loss statement current within 180 days of application, including supplementary schedules for the last three fiscal years.
  • Projected financial statements, including a detailed one-year projection of income and finances with a written explanation of how you intend to achieve your goals.
  • Year-end balance sheet for the last three years, including a detailed debt schedule.
  • Reconciliation of net worth
  • Interim balance sheet
  • Interim profit and loss statements

4. Ownership and affiliations

Including a list of names and addresses of any subsidiaries and affiliates, concerns in which you have a controlling interest, and concerns that may be affiliated by stock ownership, franchises, proposed merger, or otherwise.

5. Business certificate or license

You’ll need to supply the original business license or certificate of doing business. If you are a corporation, stamp your corporate seal on the SBA Borrower Information Form (SBA Form 1919).

6. Loan application history

Include records of any loans you may have applied for in the past.

7. Income tax returns

You’ll need to provide signed personal and business federal income tax returns for the previous three years.

8. Resume

Include personal resumes for each principle, tailored to the loan application process. This is a great opportunity to flaunt your skills and ability to run a successful small business.

9. Business overview and history

Supply a brief history of your business and its challenges, including an explanation of why you’re seeking an SBA loan and how it will help your business.

10. Business lease

If your business has a brick-and-mortar location, include a copy of your lease or a note from your landlord explaining the terms of the lease.

If you are purchasing an existing business, you will also need:

  • A current balance sheet and profit and loss statement for the business to be purchased
  • Previous two years of federal income tax returns for the business to be purchased
  • Proposed bill of sale, including terms of sale
  • Asking price with schedule of inventory, machinery and equipment, and furniture and fixtures

You may also be asked to provide a detailed plan for how you intend to deal with the ongoing COVID-19 pandemic. Lenders have grown more conscious of security for loans in the pandemic, and are more likely to subject your application to a stricter review to ensure you can tolerate extra stress by considering questions like “what if this business needs to operate at 50% capacity?” or “what if this business cannot operate with clients indoors?”.

Lenders may also review COVID-19 trends in your area and base their lending decision on when your business segment will return to normal, as well as the likelihood of avoiding future shutdowns.

Loan Documentation Requirements for Bank Loans

Banks, credit unions, and other traditional lenders also have lengthy paperwork requirements. If you’re applying for funding from a bank, prepare all the documentation you’d need for an SBA loan. You may not need all of it, but it’s a good idea to have it prepared just in case.

Loan Documentation Requirements for Alternative Lenders

Alternative lenders, including direct online lenders like Greenbox Capital®, have streamlined online application forms that require less extensive paperwork. Applying for funding from these lenders often begins with a simple online form that will collect information such as:

  • How much funding you’re seeking
  • Monthly revenue
  • Time in business
  • Company name
  • First name, last name, and contact info of applicant

You’ll also be asked to submit:

  • Tax returns: You may be asked to submit up to three years worth of signed personal and business federal income tax returns, depending on the age of your business.
  • Bank statements: Collect three most recent bank statements for your business and personal accounts.
  • Cash flow statements: Include a balance sheet and profit and loss statement.
  • Personal identification: Including social security, driver’s license, or any current government-issued photo ID.
  • Business lease: If your business has a brick-and-mortar location, include a copy of your lease or a note from your landlord explaining the terms of the lease.

Loan Documentation Checklists

SBA (7a) loans and bank loan documentation checklist

If you’re purchasing a business:

  • Current balance sheet and profit and loss statement for the business
  • Federal income tax returns
  • Proposed bill of sale
  • Asking price with schedule of inventory, machinery and equipment, and furniture and fixtures

Alternative funding loan documentation checklist

  • Online application form
  • Federal income tax returns
  • Bank statements
  • Cash flow statements
  • Personal identification
  • Business lease

Are you ready to apply for small business funding?

Loan eligibility and documentation requirements vary by lender and funding type, which can make it difficult to know how to apply for small business funding when you need it.

Compiling all the necessary documentation before you apply can significantly streamline the application process, especially if you’re applying for funding from an alternative lender. These lenders require less paperwork, and can approve your application and deposit funds in as little as one business day if all the documentation is supplied in a timely manner.

Do you have more questions about how to apply for small business funding? Read our guide:

Read How To Apply for Small Business Funding Guide
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