When going for a business loan, whether short-term, merchant cash advance or equipment loan, you’re going to need to supply many documents and pieces of information — one such requirement: any contracts and legal agreements you have in place. These can include things such as third-party contracts, vendor/supplier contracts, and agreements as well as real estate contracts you may have executed.
It is always important to be as thorough as possible; in this way, you hasten the process and thereby get your financing sooner. Your lender might ask to see any combination or all of the following:
- Corporate bylaws
- Franchise agreements
- If you’re purchasing a business: financials & sales agreements
- Real estate purchases relevant to your company
- Any partnership contracts/agreements
The reason for this required information is because any of the above could have an impact on your company from both a legal and financial perspective. Before issuing the business loan, the lender is merely trying to paint the most comprehensive picture possible. With alternative lenders especially, by doing this, they can rely less on credit score alone and more on the “bigger picture.”
You may also, depending on the loan product, have to show that you are indeed a small business which can be done a few different ways generally though most lenders will look at the total number of employees and also the amount of revenue generated by a company. They might also ask that you provide proof of those employees via payroll records. Staying organized and on top of your record keeping is critical, mainly if you know you’ll be applying for a business loan.
At First Union, our goal is to do everything we can to get you the funding needed. You can have access to cash in just a few days, but again, we strongly urge you to have the necessary records handy, to include any legal contracts and agreements. Want more information? Call us today. We’d love to help!
You’re reading part 1 of our 18-part series: 18 Business Loan Requirements.