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The Capital Checklist: Essential Financial Documents for Small Business Owners.

Be prepared, gain trust, and secure the funding your business deserves.



What Every Small Business Owner Should Know About Preparing for Capital

As a lender, I often hear these responses when I request financial documents:

  • “I don’t have them prepared.”

  • “Let me call my accountant and get those for you.”

  • “What is that?”

These reactions are more common than you might think, but they can slow down your loan application process and even jeopardize your chances of securing capital. The good news? With a bit of preparation, you can avoid these pitfalls and stand out as a confident and credible borrower.


Here’s a rundown of the key financial documents lenders typically request and why they matter:


1. Business Tax Returns (Last 3 Years)

Your business tax returns provide an essential audit trail of your company’s performance. They allow lenders to assess trends, spot potential risks, and evaluate the financial health of your business over time.

Pro Tip: Having these returns organized and ready to go demonstrates professionalism and transparency.


2. Personal Tax Returns (Last 3 Years)

Lenders use personal tax returns to evaluate your overall financial stability. This helps them determine your ability to support loan repayments, especially in cases where your business income may not suffice.

Why It Matters: Personal finances are often intertwined with business finances, and lenders look at both to calculate a Global Debt Service Ratio.


3. Profit and Loss Statement (P&L)

This critical document shows your revenue, expenses, and net income. A current year-to-date (YTD) P&L is usually sufficient, but be ready to provide additional historical data if requested.

What It Tells Lenders: It paints a picture of your business’s profitability and operational efficiency.


4. Balance Sheet

Your balance sheet provides a snapshot of your business’s financial position, including assets (cash, equipment, accounts receivable) and liabilities (loans, accounts payable, owner draws).

Be Prepared: A current YTD balance sheet is essential for lenders to evaluate your financial footing.


5. Personal Financial Statement

This document outlines the financial condition of the business owners. It helps lenders understand your personal ability to weather financial challenges and support your business, if needed.

Tip for Success: Accurate, detailed information builds lender confidence.


6. Debt Schedule

A debt schedule shows all your business’s existing obligations, including monthly and annualized debt payments. Lenders use this to evaluate your capacity to take on new debt.

The Bottom Line: A clear debt schedule helps lenders assess whether your business can handle additional loan payments without strain.


Best Practices for Success

Having these documents organized and easily accessible is not just a good habit—it’s a best practice for every business owner. In some cases, additional or audited statements may be required, but starting with this checklist will position you as a prepared and trustworthy borrower.


Final Thought

Being proactive about your financial documentation sets you apart as a business owner who is serious about growth. When you’re prepared, lenders notice—and that could make all the difference in securing the funding your business needs.

Start building your Capital Checklist today. When opportunity knocks, you’ll be ready to answer with confidence.


If you need help understanding any of these terms or would like a second opinion, be sure to swing by our WEEKLY OPEN OFFICE HOURS. Take the opportunity to meet with a qualified lender for free to help you gain the confidence you need.



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