What documentation is required for a business loan?
Typically when requesting a loan, a bank will ask for the following items depending on the request.
2 – 3 years Business Tax Returns
2 – 3 years Financial Statements (if available)
2 – 3 years Personal Tax Returns for owners with more than 20% ownership
Personal Financial Statement. * Click here for our form
Current Year to Date Profit & Loss and Balance Sheet (that is not more than six months old)
Current Accounts Receivable and Accounts Payable Aging Reports
How many years do I need to be in business before applying for a loan?
A business needs to be in business for two years before applying for a loan. There are loans available for startups through the sba.gov website.
How long does the loan process typically take?
The loan process typically takes between 45 – 60 days. If the package is complete at loan application then the process can be much quicker.
What is an SBA loan? What are the types?
An SBA loan is a loan that is guaranteed by the Small Business Administration. It allows for longer amortization periods and less collateral than a bank may typically require. There are two types of loans that Hamilton Bank offers through our relationship with the SBA – 7 (a) and 504. Please reference our Business Loans section for further detail.
What are the rates on Commercial loans?
Commercial loan rates vary based upon the strength of the loan request. When pricing a commercial loan rate we consider such variables as cash flow of the operating entity, financial strength of the guarantors (owners) and their credit score along with the collateral available to support the request. With those factors in mind, we then price our loans competitively.
What types of Business loans are there?
Business loans include term loans and lines of credit. Please refer to our business loans section for further detail.
What does a business typically use a line of credit for?
A business typically uses a business line of credit for short term working capital. This would include meeting payroll before a job is completed and invoiced or taking advantage of discounts on inventory by purchasing in bulk before inventory is able to be sold, etc. In essence it is any large expense that needs to be made, but can be repaid within less than 12 months.
What types of collateral would be required to secure a business loan?
Types of collateral that secure a business loan include the following:
- Commercial Building
- Accounts Receivable
- Personal Residences
- Cash Value of Life Insurance
- Cash and/or Marketable Securities