As a future small business owner, you have a lot of decisions to make, from whether to incorporate to how many employees you want to have. Perhaps the most important decision is how to fund your new business.

If you've decided to seek debt financing for your business venture, you'll want to understand all terms and condition of any loan you agree to. Private and government lenders require detailed information from prospective borrowers. You should gather all the required documentation early in the process to avoid delays.

Business Loan for Purchase of an Existing Business

Keep in mind, if you are purchasing an existing business, you will need to collect additional information like current balance sheets, profit and loss statements, previous federal incomes tax returns of the business, and more. Be sure to include information regarding the asking price of the business, complete with a schedule of inventory and equipment.

To assist you in putting your best foot forward, the following is a checklist of information and documents to be included in your business loan application package. Use the checklist below to ensure you have everything the lender will ask for to complete your application.

For more information, visit FindLaw's Business Finances section.

Checklist

• A summary description of the business, its financial history, financial needs and management.
• Information concerning the industry in which the business operates or intends to operate.
• A description of the company's current products or services and those under development, the market for the company's products or services, the company's marketing strategy, and details about the company's competition.
• For production and manufacturing companies, a listing of the raw materials used and the cost thereof, suppliers, inventory and utilities.
• A description of the company's physical facilities and lease arrangements.
• Information concerning the company's workforce.
• Audited financial statements for the past three to five years, and the latest unaudited financial statements.
• Projections of earnings for the next year.
• A listing of the status of the company's accounts receivable and accounts payable.
• A list of the company's collateral being offered as security for the loan, with an estimate of the current market value of each item.
• An organizational chart, resumés and background information concerning key management, and information regarding the stock ownership of key management.
• Copies of the companies articles of incorporation, bylaws, corporate resolutions, and pertinent legal agreements.
• A summary description of the company's insurance coverage.
• A list of the names and addresses of the company's existing lenders, attorneys, accountants, and consultants.
• A summary of the amount of the loan that is being requested and the uses to which the borrowed funds will be applied.
• A proposed payback schedule.

How a Lawyer Can Help

The decision to seek out a loan for your small business venture is one that shouldn't be taken lightly. A skilled business and commercial law attorney can help you get the best possible terms and make the process go as smoothly as possible. Be sure to have your attorney review all documentation before submitting it to your loan provider to ensure accuracy.