Gathering documents when applying for a small business loan is often a problem. Still, there is no way to avoid loan documents when trying to get funds.

The best way to minimize the hassle is to be prepared and understand how to value a small business. In other words, know all the loan documents that your lender is likely to ask for when you approach them.

To make it easier for you, here’s a list of all the loan documents you need when approaching a lender so you don’t have to find a documentation specialist for the job.

The list of business loan documents you will need

SBA 7 (a) Loans / Bank loans

SBA Loan Program 7 (a) is one of the most popular borrowing options for small businesses. It should be noted that the SBA does not grant loans itself. Rather, it guarantees small business loans from participating lending institutions. (As a result, much of the information you will need are the same documents you would need when applying for a loan from a more traditional lender.)

What makes SBA loans attractive to many small businesses is the low interest rates, but it also involves extensive paperwork.

Once you have decided to apply for an SBA loan, you will need to put together all of your paperwork. The process will then begin with your local lender, working under SBA guidelines.

Here are all the documents you will need to submit.

SBA loan application: This is the first thing you will need to complete to process your request. You can find the most recent form here (PDF).

Personal history and financial status: To assess your eligibility, the SBA asks you to fill out a few forms in which you will need to provide personal and financial information.

Company financial statements: You must also be able to prove that you can repay the loan. For this, you must provide the following financial statements: income statement and forecast financial statements.

Ownership and Affiliates: You should include a list of the names and addresses of all subsidiaries as well as affiliates. These may include concerns in which you hold a controlling interest and other concerns that may be affiliated with franchise, proposed merger, shareholding or otherwise with you.

Company certificate or license: Your original business license or trade certificate is also required. If your business is a corporation, you must affix your seal to the application form.

History of loan applications: You should include the records of all the loans you have applied for in the past.

Tax returns: Add signed personal and business federal income tax returns from executives of your business for the past three years.

CV: Also include personal resumes for each manager.

Company overview and history: Provide a brief history of the business and its challenges. Add an explanation of why you need an SBA loan for your business.

Commercial lease : Provide a copy of your commercial lease or a note from your landlord.

For the purchase of an existing business: Provide the following information: 1) current balance sheet and income statement of the business to be purchased, 2) federal income tax returns for the past two years, 3) proposed bill of sale including terms of sale, 4) asking price with inventory schedule, machinery and equipment, furniture and accessories.

Alternative lenders

If your business does not meet the financing requirements of a traditional bank and you are wondering how to get a business loan, you may consider alternative lenders.

Alternative lenders provide financing even to small businesses that have not been around for a long time. And they have a less paper-intensive application process that can be completed online.

Here are the types of loan documents that most alternative lenders will ask you to submit.

Income tax returns: Be sure to submit the last three years of signed federal personal and business income tax returns.

Bank statements: Submit the last three bank statements for your business and personal accounts.

Cash flow statements: Include your balance sheet, cash flow statements and income statements.

Personal identification: Includes Social Security, Driver’s License, or any government issued photo ID.

Commercial lease : Provide a copy of your commercial lease or a note from your landlord.

Peer-to-peer loan (P2P)

P2P lenders help businesses by connecting the capital of retail and institutional investors through platforms such as Funding Circle, Prosper and Lending Club. Over the years, P2P loans have become a popular source of finance for a large number of small businesses.

Here are the documents you will need to submit when approaching a P2P lender.

Pieces of identity : Make sure you have your ID documents in place to set up direct credit as soon as possible.

Social security proof: Provide a copy of your Social Security award letter or SSA-1099 form for the last tax year.

Proof of pension or annuity income: If you are receiving income from a pension or annuity, attach a copy of your most recent award letter or statement.

Online Markets

These days a number of online markets have become a popular source of small business finance. These marketplaces function like exchanges, centralizing and streamlining the loan application process. They link businesses to a range of traditional and alternative lenders. Some of the well known players are Fundera and Biz2Credit.

Some of the loan documents that you need to provide when going to an online marketplace for financing are as follows:

Personal history: Present your proof of identity and address as well as proof of your professional qualification.

Tax returns: Include federal personal and business income tax returns for executives in your company for the past three years.

Signed request: Provide all the basic information about yourself and your business.

Bank account statements: Submit the last six bank statements for your business and personal accounts.

Commercial lease : Provide a copy of your commercial lease or a note from your landlord.

How to write a business plan for a loan

In almost all of these cases, you will likely need a business plan to prove that you are ready to generate income and repay your lenders. A business plan is a pretty basic concept that most entrepreneurs are already familiar with. But when trying to get a loan for your business, it can be helpful to tailor some of your information to that particular situation.

You should always include all of the basic components of a traditional business plan, including summary, description, opportunity and competition analysis, marketing, and contingency plans. However, when applying for a loan, you should pay close attention to financial information. Make sure you include what you are going to use the money for and how it will help you grow and become more profitable. Include specific projections and back them up with facts. Plus, you need to be transparent about any future loan applications you plan to go ahead with, all supported by your current accounting and financial records.

The paperwork may seem like a lot of work, but preparing ahead of time can actually help save time. Just make a quick checklist of all the documents you need to submit before you start the process. You can also speak to a representative to collect and organize your documents on time. Once you have prepared yourself, it will be easy to finish the job.

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