A strong personal financial history and credit score, as this shows you’re good at managing your own money, which can translate to responsible business management.Your LLC’s Employer Identification Number (EIN).Business licenses and operating permits for your LLC.

There are several other areas that will maximize your chances of getting an LLC loan:

Any legal contracts and agreements you have in place with other third parties.

An LLC business plan that details areas including a business overview, operations plan, sales and marketing plan, competitive market analysis, product and service overview, financial plan, projections, and a management team summary.

An operating agreement for your LLC that shows how various aspects of the business are managed.

Basic facts about your LLC like its name, address, industry, locations, etc.

The more supporting evidence in your LLC business documents, the better.

Your debt schedule and repayment plan if you already have loans.

Tax returns for you (pass-through income from your LLC on your 1040) and your LLC (1040 Schedule C).

Account statements for your LLC like bank and credit card transactions.

Detailed projections of your future revenues, expenses, and profits, based on multiple future scenarios.

A cash flow statement that shows how money is moving through your LLC.

A profit and loss report that shows where your LLC revenue is coming from, your expenses, and the profit you have left over.

A balance sheet that lists what your LLC owns and owes at a particular point in time.

You can get the necessary financial documents from your accountant and your bookkeeping software:

Requirements do vary by lender, but we’ve listed some common ones below. One of the most common reasons small business loans are turned down is a lack of supporting information and evidence. Lenders rely on extensive documentation and reports to decide if they want to lend to your LLC. Creating a Strong Foundation for Your LLC Loan This will involve deep research into your chosen area, projecting future demands and costs, analyzing your LLC’s financial situation, and speaking with experts. Once you know the purpose of a loan, you’ll need to carefully work out exactly how much to borrow. Increasing your working capital to maximize opportunities.Refinancing existing debt for better terms and interest rates.Investing in employees, assets, or equipment.

Increasing your inventory to meet customer demand.Expanding into new products, services, and marketplaces.Lenders will want to know what your LLC is using the money for. Once your LLC is formed, get a separate bank account and complete any other steps like getting an Employer Identification Number.Įstablishing Why You’re Borrowing and How Much Your LLC Needs to Borrowīefore applying for a loan, you’ll need to ask two important questions:.Gather together information about your business and file “Articles of Organization” to legally form your LLC.For most states, this will be your secretary of state. Find out what agency is responsible for forming businesses in your state.Forming an LLC is quick and easy, and you can either do it yourself or use one of the many company formation services. You will need to legally create an LLC before borrowing money. In some cases, an LLC can provide tax advantages with the IRS.Ĭreating an LLC Before Applying for a Loan.Taking the time to form an LLC shows that you’re serious about business and can help when it comes to getting customers, working with banks, and finding suppliers.LLCs can have their own credit histories and credit scores, in addition to your personal history and score.LLCs can reduce your personal liability to debts incurred by the LLC, although providing a personal guarantee to a lender will remove this shield.LLCs are a “separate legal entity” from you, which means they have their own assets, liabilities, bank accounts, etc.LLCs provide several advantages to small business owners: Fortunately, by taking a few simple steps, you can maximize your chances of being accepted for an LLC small business loan. Like many other types of organizations, LLCs often need to borrow money to grow. Limited liability companies (LLCs) are a popular way for entrepreneurs to create and run a business.

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