In order to qualify for any form of debt financing, you and your business will need to deliver certain documents to potential lenders. Each lender will have its own requirements but in general, they will ask for the following documents during the business loan process:
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Business Information
At a bare minimum, lenders will need to identify the registered business. As such, they will request the business name, tax identification number, mailing address, etc.
They may request that you deliver a copy of the business certificate of incorporation or articles of incorporation or other official business registration paperwork to verify this information.
Financial Records
Of course, in order to repay a loan, your business must provide evidence that its financials can handle the payments. As such, lenders will inevitably request to see some financial documents.
Generally, these documents include:
Bank Statements which detail monthly cash inflow and outflow in the business.
Tax Returns which outline financial statements filed with the government tax authority. This will also allow the lender to identify if there are any outstanding taxes owed by the business to the government.
Income Statement and Balance Sheet may be requested for larger loan amounts.
Personal Financial Records of the Business Owner may be requested in situations where the owner intends to personally guarantee the loan.
Business Plan may be requested if the business is a startup or new business which has no significant financial or credit history.
Personal or Business Credit Score
If you own a small business that is intricately tied to your personal finances, lenders will often assess your personal credit score in addition to the business credit score to determine if you qualify for the loan.
Note that even if you have a poor credit score, there are lots of lenders who would still provide loans to you especially if the business has the ability to repay the loan.
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