Business loan

14 Small Business Loan Documents You’ll Need

If you’re like most small business owners, the thought of taking out a loan to grow your business is daunting. Loan documents are essential when small business owners are looking for financing. But what documents do you need for your loan application, and where do you start? Relax – we’ve got you covered. In this article, we are going to reveal a list of 14 essential documents for small business loans.

What personal and financial information do lenders require?

So what are the loan documents? Loan documents are a series of forms and applications used to apply for a loan, including the promissory note, security agreement, and disclosure statement. Loan documents provide the lender with all the information they need to make a loan decision. In addition to business and financial information, the lender may also require statements of personal information, such as your credit score and debt-to-equity ratio.

The 4 main types of loan documents

There are four main types of loan documents a borrower must provide when seeking commercial financing, including:

  • Loan estimate. The loan estimate is the first part of the lender’s documents and outlines the terms of the loan.
  • Rate lock form. A rate lock is a written agreement between the borrower and the lender that guarantees the loan rate for a certain period of time.
  • Borrower information. Borrower Information is a form that includes the personal information of everyone who is listed on the loan application.
  • Closing Disclosure. The closing disclosure provides the final loan details, including any conditions or endorsements.

14 Documents Required for Loan Approval

Wondering what documents are needed for a small business loan? The entire agreement, or loan package, consists of a number of documents that the borrower and the lender will sign. And while some lenders do not require a personal guarantee from the business owner, other lenders may require it. The loan application process can be long, so it is important to start gathering the necessary documents as soon as possible.

1. Updated business plan

An up-to-date business plan is one of the first things a lender will ask for. Your business plan should include your company’s financial history and balance sheet, as well as your current and future goals. This document will give the lender a better understanding of your business and help them determine if you are a good candidate for a loan.

2. Business tax returns

Business tax returns are another important document that lenders will ask for. These documents provide the lender with information about your business income and expenses. It is important to note that lenders generally ask for tax returns for the last three years.

3. Bank statements

Bank statements it’s like that cash flow for the last three months are also required by most lenders. This document will help the lender understand your business’ financial situation and determine if you have the ability to repay the loan.

4. Company registration

Lenders will also require proof of legal registration of your business. This can take the form of a business license, articles of incorporation or a partnership agreement.

5. Commercial licenses

Commercial licenses are required to operate in most states. This document will show the lender that your business is legitimate and that you are operating within the law.

6. An EIN

EIN, or Employer Identification Number, is a unique number assigned to your business by the IRS. This document is required to open a business bank account and will be used by the lender to verify your business identity.

7. Financial statements

Financial statements include your company’s balance sheet, income statement, and cash flow statement. These financial statements will allow the lender to better understand the financial situation of your business. If you are applying for a loan, it is important to ensure that these statements are up to date and accurate.

8. Purpose and use of the loan

Unlike personal loans, business loans generally have to be used for a specific purpose. Your desired loan amount could be used to purchase inventory, expand your business, or hire new employees. Lenders will want to see how you plan to use the loan funds and how it will benefit your business.

9. Loan history

If you have taken out a business or personal loan in the past, lenders will ask you for information about your repayment history. This document will show the lender how you have handled previous loans and whether you are a responsible borrower.

10. Sureties and Warranties

Many lenders will require collateral for a business loan. This means that you will need to put up something of value, like your house or your car, in order to secure the loan. In some cases, a personal guarantee may also be required. This means that you, as the business owner, will be held personally responsible for the loan.

11. Credit report

Your personal credit report is another important document that lenders will ask you for. Your credit report will show the lender your credit history and whether you have been responsible for previous loans. A good credit report and a good credit rating will increase your chances of being approved for a loan.

12. Account Information

In order to complete the loan application process, you will need to provide your business account information. This includes your bank account number, routing number and account balance. The lender will use this information to deposit the loan funds into your account.

13. Budget and future cash flow estimates

A budget and cash flow forecast are important documents that will show the lender your plans for the future. This document will help the lender understand how you intend to use the loan funds and whether you will be able to make the repayments.

14. Income statement

An income statement is a document that shows your business income and expenses over a period of time. This document will help the lender understand your business’ financial situation and determine if you have the ability to repay the loan.

Other Information Business Owners May Need

In addition to the standard loan documents, there are a few other pieces of information that business owners may need to provide, depending on the different lenders. They may require your information about your living situation, proof of address, and proof of business experience.


What should you know before signing a business loan agreement?

Business owners should be aware of the interest rate on the loan, as well as any origination fees or other associated costs. They should also receive a loan estimate from the lender, which will show monthly payments and the total cost of the loan.

What is proof of activity for an SBA loan?

For an SBA loan, business owners must provide proof of business activity, such as tax returns, bank statements, or financial statements. They may also need to provide a business plan or other documents outlining their business model.

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