Taking out any kind of healthcare business loan is going to require the business owner to produce a lot of paperwork, no matter the health of the business’s finances. The lending institution will determine the exact paperwork that is needed to take out a loan. Below are some of the most common types of paperwork that most banks will be looking for.
Tax Returns
If a healthcare business has been in operation for more than a year, then it should have tax returns. Business owners need to file taxes for their businesses at the same time of year that the average person needs to file his or her income taxes. The bank will determine how many years’ worth of tax returns the business owner will need to produce. Usually, the bank will not require more than three years of tax returns. Any tax returns or tax transcripts the business owner gives to the bank for verification must include the business’s IRS Tax Identification Number on them to prove the business is legally recognized by the federal government.
Financial Statements
Even if a business has not been in operation for a year, the business owner should still have financial statements. One type of financial statement the bank will want to see is a bank statement. However, these will likely not be required if the business owner is applying for the loan from the same bank he or she uses for their business, as the bank will already have these records.
The business will also need to show other financial records. These statements will include the business’s day-to-day working capital. These numbers are usually included in a business’s income statement or kept in an accounting book.
Existing Loan Agreements
If a business owner has taken out loans from other banks, then he or she will need to give this paperwork to the bank he or she is trying to get a new loan from. Banks want to know about any outstanding debt a business owner has before doing business with them. If a business owner lies about not having existing loan agreements, this could disqualify him or her from qualifying for a loan.
Failure to produce any of these documents may disqualify a business owner from taking out a loan. On the bright side, having all of these documents prepared ahead of time can help business owners to get approved and take out a loan faster.
Seek Expert Assistance
At Monterey Commercial Capital, our friendly team specializes in commercial finance solutions. We offer a huge range of business loans that help you reach your objectives, whether you need more working capital, equipment, or inventory.