What’s Involved in the Loan Application Process?

Business meeting. Two young business people sitting at desk in office and discussing something

Now that you’ve decided an SBA loan is the right way to meet your business goals, it’s time to start the application process.

The Small Business Administration (SBA) backs SBA loans. It’s sort of like an investment the government makes in America’s entrepreneurs, startups, and small business owners. Because it’s guaranteeing a portion of the loan, the SBA likes to make sure each business it lends to has its i’s dotted and t’s crossed. This means you’ll need to explain your business and the intended use of the funds you’re applying for.

This may seem overwhelming, but don’t worry. Your First Bank SBA lending expert will analyze your plans, financials, and business history, as well as your ability to repay the loan according to SBA terms. They’ll also walk you through the lending process so that everything is clear.

Having the following information prepared upfront will make it easier on you—and may increase your chances of getting approved.

Clear Statement of Use

This written statement gives you an opportunity to show how you intend to use the proceeds of your loan. Use your business plan to help build a case for how the loan will help your business as well as how you’ll repay it.

Business Information/History

Gather key information about the history of your business. Who’s on the management team? What products and services do you provide? Who’s your target customer? What’s the competitive landscape?

Financial Statements

Pull together your past financial statements, including your balance sheet, profit and loss statement, cash flow projections, and bank statements. You’ll also need to include projected financial statements like forecasted profit and loss statements.

Business Plan

This step is critical. Tie all of the above documents together in a formal business plan. Your plan will show lenders a roadmap for your business and give them a concrete understanding of how the funds will impact the business.

Tax Returns

Include your business and personal tax returns for each of the past three years.

Credit History

Before submitting your loan application, check your credit score and credit history. This will give you and your First Bank lending expert a better understanding of your financial position as well as your ability to repay the loan.

Relevant Business Documents

Collect any other business and legal documents—like leases, articles of incorporation, business licenses, or resumes—that could give the SBA and your lending expert a clearer picture of your business.

These documents will work together to tell the story of your credit, cash flow, and business future—and might help increase your chances of getting approved.