What Should You Expect when Applying for a Small Business Loan?


As a small business owner, you may have already looked into applying for a small business loan to fuel plans for expansion or otherwise put your company in the best possible position for success. While the application process for a small business loan is simple and straightforward when you work with the right lending partner, it can be hard to find information about what to expect during the process.

Use this guide to prepare yourself for the small business lending process and remember that there’s not much to worry about when working with a knowledgeable and experienced partner.

What do I need to have on hand to apply for a small business loan?

Requirements for information can vary greatly between traditional financial institutions, dedicated small business lenders like National Funding, and other sources of capital. Many traditional lenders will, for example, request more detailed and involved information than other providers. In order to apply, a bank may require a small business owner to share or provide access to some or all of the following:

  • Personal and business credit reports.
  • Personal and business income tax returns.
  • Cash flow and profit and loss statements as well as a balance sheet.
  • A detailed business plan.
  • An application that collects additional data.

Other items that may be necessary include collateral for the loan and a variety of legal documentation. Traditional lenders may also set a range of conditions related to a business’s size, revenue, length of time in operation, and other factors.

However, this isn’t always the case when partnering with a specialized provider like National Funding. Along with a one-page application, small business owners who work with us only have to:

  • Provide three most recent monthly bank statements
  • Demonstrate $100,000 in annual gross sales
  • Confirm at least one full year of operations.

small business loan

What does the timeline look like?

Loan timelines are also highly variable, depending on the organization loaning you the funds. Approval and provision of funds can take many weeks or even months, depending on a variety of factors that are out of your control. Sometimes, this isn’t a major issue for small business owners. When a time-sensitive project or a major, unexpected repair bill pops up, however, it can be difficult or impossible to wait that long to receive a loan.

National Funding offers shorter timelines that generally take days, not weeks or months, to provide both a decision on the loan application and the money tied to it. Depending on underwriting guidelines, receipt of required documentation and your bank’s processing time, we can provide approval and funding in as little as 24 hours for qualified applicants.

What can I use this small business loan for?

Some lenders require the money go toward a specific purpose. Others, such as National Funding, allow funds to go toward any legitimate business expense. This is useful when repairs cost less than expected or a project comes in under budget and money from the loan remains. In these situations, business owners can put the rest of the money to work in other ways without worrying about violating the loan agreement.

Nevertheless, it’s important to have a specific use in mind when applying for a small business loan, even when the loan is limited to a single project or need. You should have a clear plan for using a significant majority of the money and understand how you will pay it back over the term of the loan.

Choosing the right small business lending partner is an important decision for small business owners just like you. Consider working with National Funding to benefit from nearly two decades of dedicated small business lending experience.

Small Business Funding