Let’s face it—paperwork is part of being a small business owner. From timesheets to invoices to purchase orders, it’s something you tackle daily.
However, when it comes to applying for an SBA loan, that familiar stack can suddenly feel like a mountain. It’s easy to feel overwhelmed by the long list of forms and requirements standing between you and the funding you need to grow your business. Not to mention, gathering these documents isn’t just a formality; each one matters in determining your SBA loan eligibility.
So, where do you even start? Do you know which documents are required for a bank loan application or how to navigate the SBA loan process? While the exact requirements may vary from bank to bank, having a clear idea of what’s expected will make the process much easier.
By gathering the right information, you’ll streamline your application and be able to focus on what truly matters—growing your business. When you’re ready to apply, consider these tips to get started.
What documentation do I need for an SBA loan?
1. Personal background and resume
The information needed includes your business background and information about the business owners, including resumes, personal financial statements, personal income tax returns, previous addresses, names used, criminal record, and educational background. All this information will help form a full picture of the business, which is crucial in understanding the business and its leadership.
2. Business plan
A business plan is a detailed document that outlines your business goals, financial projections, and how you will use loan proceeds. It’s an assessment of what you want to achieve as a business, the money needed to get there, and a financial snapshot of your business over a set period of time.
While SmartBiz® doesn’t require a business plan to begin a loan application, many banks and lenders do. They often ask for a business plan as part of their loan application process to evaluate the viability and direction of your business. If you need help preparing a business plan for your small business, there are free or low-cost resources available. Check out your local Small Business Development Center (SBDC) for assistance.
3. Personal and business credit reports
Lenders may check your personal and business credit histories. So it’s good to know where you stand before you apply for finance. To prepare, get a credit report from each of the three main consumer credit reporting agencies: Equifax®, Experian®, and TransUnion®, or you can go to Annual Credit Report to get all three for free. When you review these reports, look out for any errors or inaccuracies that could hurt your credit score. Taking the time to fix errors will improve your overall credit profile and may improve your chances of getting good loan terms.
SBA loan credit score requirements
Lenders typically require a personal credit score of at least 680 to meet SBA loan credit score requirements, indicating a solid track record of timely payments and sound financial habits. While a higher score certainly helps, it’s not the end-all and be-all. The SBA evaluates multiple aspects of your business, meaning a slightly lower score could still be acceptable if your business shows strong financial performance.
4. Income tax returns
When applying for an SBA loan, you’ll be required to submit personal and business tax returns from the last three years. These returns help lenders evaluate your financial standing and decide whether your business can handle loan repayment. Keeping your tax records organized and current not only simplifies the process but also reflects a stable, growth-ready business.
SBA loan tax return requirements
When applying for SBA loan programs, you’ll typically need to submit personal and business federal tax returns from the last three years. Although three years is the standard, some lenders may request more or fewer years depending on the loan program. Be sure to review your tax returns carefully for accuracy, as any errors could slow down the loan approval process.
5. Business financial statements
Owners with more than a 20 percent stake in a business are often required to submit signed personal financial statements. Business financial statements generally have three components:
- Profits and loss statements
- Cash flow statements
- Balance sheets (SmartBiz requires profits and loss statements and balance sheets)
6. Collateral
Collateral requirements may vary depending on the type of SBA loan, but it's always a good idea to be prepared. Make a list of personal or business assets that could secure your loan, whether it’s real estate, equipment, or even savings accounts. Having this list of assets readily available may help speed up the application process.
Do SBA loans require collateral?
Many times, SBA loans require collateral, especially larger loans. Collateral is security for the lender in case you can’t pay back the loan. However, the requirements generally vary depending on the lender and the SBA loan you’re applying for. Some loans under the SBA Express program don’t require collateral for loans up to $25,000.
SBA loans collateral examples
Collateral may be based on your business assets or personal property. Here are a few examples of collateral that SBA lenders may accept:
- Commercial or residential real estate
- Business equipment or machinery
- Inventory or accounts receivable
- Personal assets, like vehicles or savings accounts
Collateral provides lenders with security, so having a strong list of assets may improve your chances of loan approval, especially for larger loans.
7. Legal documents
In addition to financial documents, lenders will request legal paperwork that highlights your business’s structure and compliance. Expect to submit articles of incorporation, business licenses, franchise agreements, and third-party vendor contracts. These documents help verify that your business is legally sound and properly organized, so make sure everything is prepared before you apply.
8. SBA forms
When applying for an SBA loan, there are specific forms that you will need to complete. The exact forms depend on the type of SBA loan you are applying for, but you can expect to fill out forms that collect basic business and personal information. These forms help streamline the application process and ensure all required information is provided for the lender’s review.
SBA Form 1919
The SBA Form 1919, or Borrower Information Form, collects identifying information about your business, loan request, indebtedness, principles of the business, and information on current or previous government financing.
SBA Form 1920
The SBA Form 1920, or Lender Application, may also be required.
Other SBA Forms
In addition to Forms 1919 and 1920, here are other SBA forms you may need to fill out depending on the loan and application specifics:
- SBA Form 413 Personal Financial Statement: This form provides an overview of the business owner’s personal financial condition, detailing assets, liabilities, and net worth. Lenders use this to evaluate the individual’s financial stability and creditworthiness for an SBA loan.
- SBA Form 912 Statement of Personal History: This form collects personal background details, including any criminal history, to ensure the applicant’s eligibility for government-backed financing. It helps lenders determine whether any past legal issues could affect the loan process.
- SBA Form 159: Fee Disclosure Form and Compensation Agreement: This form reveals fees paid to agents or consultants who assisted with the loan application, ensuring transparency and compliance with SBA rules about third-party compensation.
- SBA Form 4506-T: Request for Transcript of Tax Return: This form authorizes the SBA and lenders to obtain the applicant’s federal tax return directly from the IRS, verifying reported income and ensuring accuracy with the loan application data.
SBA Loan Eligibility
Beyond the necessary forms and documents, review the SBA loan eligibility summary listing specific requirements for loans from SmartBiz. This includes business requirements, cash flow needed, liquidity, personal credit, public records, and specific SBA criteria.
To be eligible, a business must have been operating for at least two years, and its owners must be U.S. citizens or legal permanent residents.
Typically, businesses approved for an SBA loan from SmartBiz l have $50,000 to $5 million in annual revenues and 1 to 40 employees. Most are profitable and have a positive cash flow. All are able to provide proof that they are able to make the monthly loan payment.
Get the documents together you need to apply for an SBA loan
Getting an SBA loan may feel daunting, but with the right preparation, you may be able to clear the way for the funding your business needs. From gathering personal and business tax returns to assembling financial statements and legal documents, every step helps paint a complete picture of your business for the lender. By knowing the SBA loan requirements and having your SBA loan documents ready, you’ll speed up the process and avoid delays.
What to do next? Get your documents in order, review your eligibility and take control of your SBA loan. The more prepared you are, the sooner you can get back to what matters most—growing your business.
