Business loan requirements are set by each funding partner, but the same few records come up again and again: tax returns, bank statements, the lease and a list of current debts. This article takes them one at a time and says what each shows, where it falls short and how an Ashland, OH owner can fill the gap.
Start with the request form. Records come after, if a partner asks: tax returns show the filed years, bank statements show recent months, the lease and debt list show what runs on and for how long.
The request form comes first; records follow if a partner asks
An Ashland, OH owner does not need a full stack of paper to start. The request form keeps to basics: who to call, the company, how long it has run, its yearly revenue and the sum it needs. Oceanreach passes that request to funding partners, and a partner that wants to look further may ask for some of the records below.
Having them in one folder helps, because the questions come one after another and each record answers a different one.
Tax returns: the filed years and the gap since the last one
A business tax return shows a full year: revenue, costs and what was left. A partner may ask for one or two years of returns, and for an owner with a pass-through company, the personal return that carries the business income.
The weak spot is age. Even a return filed on time covers a year that has already closed. A profit-and-loss statement for the months since then fills that gap, and a short note can explain anything unusual, such as a year with a large one-time equipment purchase.
Bank statements: deposits, balances and the payments already going out
Statements show the recent months a return cannot: money coming in, the low points in the balance, and every loan or lease payment already leaving the account. A partner may compare those regular payments with deposits.
In this invented example, a grocery store's statements show average monthly deposits of $48,300. Its existing equipment payments come to $2,140 a month, and the new request would add about $1,190. Together that is $3,330, or 6.9% of the deposits, a figure the owner can work out before any partner does. Overdrafts or returned payments in those months are worth a sentence of explanation in the request.
The lease and the debt schedule: two pages about time
The lease tells a partner how long the business can stay where it is. A loan that runs five years next to a lease that ends in 14 months raises an obvious question; a renewal letter or an option clause answers it.
A debt schedule is a one-page list of what the business owes: each lender, the balance, the monthly payment, the rate if known and the payoff date. An owner can build it from the statements and loan agreements, and it keeps a partner from guessing at numbers.
Which records match which request: equipment, payroll gaps or a credit line
| Request | Records that fit it |
|---|---|
| Equipment | The vendor quote or invoice, recent bank statements, and the title or serial details for a used item |
| Working capital for a payroll gap | Recent bank statements, the payroll register and a list of unpaid customer invoices |
| A line of credit | The last filed returns, this year's profit and loss to date, and a few months of statements |
| A term loan for a larger cost | Returns, statements, the debt schedule and a short note on what the money buys |
These are typical asks, not a fixed list; each partner sets its own. The business loans overview describes each funding type on this site in more detail.
By Oceanreach Capital Group · Updated
