Interim Financial Documents for SBA Loans

When you want to grow your business, an SBA loan can give you the capital you need to take on new opportunities. The SBA loan application process is known to be comprehensive and you’ll be asked to provide several documents, including financial statements for your business. And before your loan can close, you’ll need to provide that information again.

Here’s a closer look at the requirements for interim financial documents for SBA loans, and why the SBA requires this level of documentation. When you know what’s expected before you apply, you can make the process smoother and easier for yourself and your lender.

Why the SBA requires updated interim financial statements

SBA loan programs can be used for nearly any business need and offer competitive rates, more flexible approval criteria, and beneficial repayment terms. That’s why many small business owners turn to programs like the SBA 7(a) and SBA 504 loan programs when they need to fund things like buying or renovating a commercial property, buying a business, purchasing major equipment, refinancing existing debt, and more.

Depending on the project your SBA loan is funding, it can take several weeks or months for the loan to close and fund. Your lenders needs to ensure that you’ve stayed on track with your business plans and financial projections, so you’ll need to submit updated interim financial documents for your SBA loan. This requirement gives your lender a last look at your business’s financials before the loan closes and your fund disbursement begins.

The SBA considers your financial statements “expired” if they’re older than 120 days. When you submit your updated interim financial documents, your lender and the SBA have an opportunity to handle any potential problems that may have come up between the start of the application and the closing.

What interim financial statements need to be submitted for SBA loans?

Prior to closing, you’ll need to provide interim financial statements and/or tax returns for your business. These documents need to be created within the last 120 days before submitting them to the SBA.

Some of the interim financial statements that are required include:

  • a balance sheet: a look at your business’s financials at one date in time
  • a profit and loss statement, or income statement: a document that shows your revenues and expenses for a set time period
  • an aging report for your accounts receivable and payable: a report that shows how long the money you owe (payables) or that’s owed to you (receivables) have been outstanding

You can easily produce these documents using bookkeeping software like QuickBooks, Xero, or FreshBooks. If you don’t use bookkeeping software, you’ll need to ask your bookkeeper or accountant to work with you to create the interim documents.

If the deadline to submit your documents or the date of your closing falls within the IRS tax-deadline dates for business or personal tax returns, then you’ll need to submit your tax returns or a copy of the extension filing. The typical tax deadlines are:

  • March 15 for partnerships and S corporations
  • April 15 for sole proprietorships, C corporations and individuals 

In addition:

  • If your business files its taxes using IRS Schedule C (sole proprietors), you’ll need to submit a balance sheet with your latest tax return or interim.
  • For start-up projects you’ll need to provide two full years of assumptions, including a monthly breakdown of your revenue projections for the first year.
  • If your business is an affiliate, you must provide the last two fiscal year-end financial statements and/or federal income tax returns of affiliates. If you qualify for the SBA size standard via the industry size standard, you’ll need to submit three years of fiscal year-end statements and/or federal income tax returns.
    • The SBA needs returns for affiliates to determine SBA-loan eligibility through the size standard calculation. Additionally, lenders are required to ensure that an affiliate’s cash flow doesn’t hurt the operating company that’s applying for the SBA loan.

Pursuit is here to help

Every day, Pursuit works with business owners like you, including many first-time applicants who are new to the business loan application process. We’ll be with you through every step of the process and make sure that your application is complete and correct, from start to finish.

We also have a comprehensive business resource library that includes information about how to create accurate financial statements, including interim financials that meet SBA requirements, and much more. Explore our resources to find the specific information you need to manage your business effectively and efficiently.

If you’re looking for financing, Pursuit has more than 15 business loan options that can support nearly any business need. Contact us to learn more about your options and how we can work together to grow your business.

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