The information requested in a commercial loan application varies depending on the type of loan and financial institution. Be prepared to provide:

• Basic business and personal contact info (name, address, phone, e-mail)
• Industry or nature of business
• Employment Identification Number (EIN)
• Years in business
• Loan type (business expansion, equipment purchase, refinance)
• Amount of loan

A personal financial statement is a snapshot of your financial position based on assets and liabilities. It lists:

• Your personal assets and their worth
• Your personal liabilities (what you owe) and their worth
• Total of both assets and liabilities
• Your net worth

When you started your business, you were required to file articles of incorporation with the Secretary of State’s office in your region to establish your business as a corporate entity. Also called a corporate charter, articles of association, or certificate of incorporation, the document contains:

• Business name
• Name and address of registered agent
• Corporate structure
• Names and addresses of board of directors
• Name and address of incorporator
• Duration of corporation

An operating agreement outlines the financial and functional processes of the business including rules, regulations and provisions. Pennsylvania and Delaware do not require operating agreements, but lenders will request one, and for LLCs, an operating agreement protects members from personal liability. An operating agreement requires the following.

• Percentage of members’ ownership
• Voting rights and responsibilities
• Powers and duties of members and managers
• Distribution of profits and losses
• Buyout and buy/sell rules

Also called a cash flow statement or income statement, this document lays out your revenue, costs and expenses over a period. Profit and loss statements require you to:

• Calculate revenue
• Calculate costs of goods sold
• Subtract cost of goods sold from revenue to determine gross profit
• Calculate operating expenses
• Subtract operating expenses from gross profit to obtain operating profit
• Add additional income to your operating profit
• Calculate interest, taxes, depreciation and amortization
• Subtract interest, taxes, depreciation and amortization expenses from EBITDA To obtain net profit

Put simply, a balance sheet is: liabilities + shareholder equity = assets. Balance sheets should be updated regularly to reflect the current financial state of a business.

• Three years of personal tax returns and applicable schedules like A,B,D and E
• Three years of business tax returns and applicable schedules like C, SE and K-1

If your credit score is low and you have business liabilities, you may need to offer collateral. This can improve your chances of qualifying for the loan, as well as improve the repayment requirements. Collateral may include business assets, real estate, cash or investments.