SBA Pre-Qualification Tips

Before completing the Application, let’s gather some basic information.

Term and rate are based on the use of loan proceeds, type of business, and strength of borrower. Therefore it is important that we establish what we call “Total Project Costs” as quickly as possible. Total project costs include everything necessary to make the transaction happen and everything needed to ensure the borrower’s success.

For instance, if you're purchasing a building, you may also have renovation expenses (new sign?) and move in expenses. Maybe you’d like to buy a new copier, computer network, or you need cash for a marketing plan. Or perhaps you have outstanding business debt which you'd like to refinance (Program 7a only). Whatever the case, it’s important that we know your total project costs.

1. Project Description. A cover sheet stating the purpose of the loan, name of the borrowing business, and names of the owners. If the loan is for a business acquisition, state your experience in the industry. Please specify how proceeds are to be used (Total Project Costs), for example $500,000 for real estate purchase, $50,000 for renovations, for a total project in the amount of $550,000. You must also tell us the amount of cash you will be contributing to the project (never less than 10% of Total Project Costs). This amount may not be borrowed.

2. Business Financials. Full business tax returns (including statements and K1s, for the last three years AND/OR year-end financial statements (Profit & Loss/Income Statement and Balance Sheet) for the past three years. These will be required from the borrowing business, owners of the borrowing business and the selling business (but not the owners of the selling business). If you and they have an accountant, get full copies electronically from the accountantw. They are easier to read and store.

3. Personal financial statement from each owner. Please provide these in electronic format, too. Forms are provided online in our Application Package.

4. Real Estate Purchase: Provide a copy of the signed purchase contract along with any information you used to value the property, such as an appraisal.

With these items in hand, you are ready to begin completing your SBA Loan
Application. If you would like our assistance, we will be glad to help. Click here for our contact information.