SBA 504 loans
can take a while to get to completion, because you must coordinate your
application between a lender and your local CDC office. Document requirements
are more extensive than with the 7(a) loan program, but the 504 offers more
flexibility. We can help you navigate this difficult process.
SBA's standard requirements for a 504 loan are as follow:
· SBA
Form 1919 - Borrower’s Information Form
Section I – to be completed and signed for each co-applicant
(e.g. Eligible Passive Company (EPC) or Operating Company (OC)).
Section II – for each individual who is a
proprietor, general partner, officer, director, managing member of an LLC,
owner of 20% or more of the equity of the Applicant, trustor (if the Small
Business Applicant is owned by a Trust), and any person hired by the Applicant
to manage day-to-day operations.
Section III – for each entity owning an
equity interest in the Applicant (e.g. ESOP, 401(k) plan, LLC, or other entity
owner entities and Trusts).
· Business Debt Schedule – Required for all businesses that reflect long-term debt on their most current Balance Sheet. This includes debts of Co-Borrowers, Affiliates, and EPC.
· Personal Financial Statement
o
Required
for all owners of 20% or more, spouses, and proposed guarantors, dated within
ninety (90) days.
o
Must
be signed by the spouse, even if the spouse will not be a guarantor.
o Please be sure that the “as of date” is
filled-in where indicated.
·
Borrower's Certification of PFS
·
Personal
Tax Returns for
the last three years.
·
Personal History Statement (e.g. Resume or CV)
·
Personal
Budget Analysis
· Documentation
of Alien Status –
for all non-US citizens who are required to complete Form 1919 and residing in
the United States.
·
Business
Financial Statements
o
YTD
Income Statement and Balance Sheet signed and dated within 120 days.
o
FYE
Income Statements and Balance Sheets or Income Tax Returns for the last three
(3) years.
o
Accounts
Receivable Aging Report
o
Accounts
Payable Aging Report
o
Cash
Flow Projections with supporting assumptions which reflect positive cash flow
within two years – Required for all new businesses, and when applicable.
o Seller’s Financials – Signed and dated by the seller – for all loan types (other than small loans) when purchasing an existing business.
·
Affiliate
Financial Statements – as listed above, but only if required by the lender.
Supporting Documents
·
Franchise,
Dealership & Licensee Agreement(s) if applicable.
·
Business/Stock/Asset
Purchase Agreements if acquiring a business.
o
Pro-forma
balance sheet for the business being purchased, within the last sixty (60)
days.
o
Existing
business owner’s tax returns for three years.
·
Real
Estate Purchase Agreements when real estate is to be purchased with SBA loan
proceeds.
·
Real
Estate Appraisals for OREO Properties
·
Environmental
Investigation Reports (Phase I and/or Phase II) if required.
Other Supporting Documents Not Identified Elsewhere
·
Lawsuit
Documents
·
Judgments
·
Bankruptcy
Filing(s)
·
Other
pertinent documentation
·
Letter
if using gift funds for down payment or liquidity requirements.
If you are applying for a loan for a hotel/motel, you will
also need:
·
Revenue
and expenses breakdown for the past year (month-to-month)
·
Occupancy
percentage and average daily rate for the area
·
Your
hotel projection worksheet
If the loan is for construction, we will need:
·
Written
estimate from a contractor
·
Contractor’s
resume
If you are refinancing a loan, you will need:
·
Copy
of the original debt documentation.
·
Original
purchase agreement, including settlement statement, etc.
·
Lienholder
information
·
Previous
government financing schedule (if applicable)
MOST IMPORTANTLY:
You will
need a complete business plan! We can assist you with this.
·
One-year
financials with projections
·
Pro-forma
financial statements