***Note: SBA Form 4 and Schedule 4a are no longer in use. The primary application form for an SBA loan is now Form 1919 – Borrower Information Form.***
SBA Form 4 “Application for Business Loan” is the backbone of SBA loans, and covers a wide range of areas. This form personal and business information, and requires a number of attachments.
Areas covered by SBA form 4 include:
- Personal information
- Number of employees
- Proposed use of loan funds
- Previous federal debts
- Assistance received with your loan application
- Business debts
- Management personnel
- Exhibits with supporting information and documentation
- Guarantor signatures
This article will guide you through filling out Form 4, and help you on your way to completing your SBA loan application.
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How To Fill Out SBA Form 4
The top of page one begins with general information about you and your business. For this section, use information that matches what you use for your personal and business taxes.
Individual: Use your full personal name as it appears on your taxes.
Full Address: Use your home address.
Name of Applicant Business: Use the name of your business as it appears on your most recent federal tax document.
Tax ID No. or SSN: If you are applying as a sole proprietorship, use your SSN. If you are applying as a partnership, LLC, or corporation, use your federal tax ID number as it appears on a recent tax document.
Full Street Address of Business: Use your business address as it appears on tax documents. Fill in the City, State, and Zip Code in the respective fields.
Type of Business: Write in the type of business your business is registered as with your state.
Date Business Established: Use the date your business was legally formed according to state tax information.
Bank of Business Account and Address: Write in the full name of the bank and its full address.
Number of Employees (Including subsidiaries and affiliates):
At Time of Application: List the number of employees currently employed at your company. Including persons employed on a full-time, part-time, and temporary basis.
If Loan is Approved: Provide an estimate of the number of employees that your business will have once you gain access to the proceeds of your loan.
Subsidiaries or Affiliates: List the number of employees currently employed by companies that are either subsidiaries or affiliates of your company. According to the SBA, affiliation exists when “one business controls or has the power to control another or when a third party (or parties) controls or has the power to control both businesses. Control may arise through ownership, management, or other relationships or interactions between the parties.” Make sure to check the fullSBA definition of affiliation in order to determine if you are involved in affiliation.
Use of Proceeds
This section of SBA form 4 requires you to provide an itemized outline of how you intend to use your SBA loan. You should list the amounts to the nearest hundred dollars. The “All Other” section is a catch all for any uses that do not fit in another category. Once you have listed all your intended uses, add up the total and write that in the “Total Loan Requested” field. Under “Term of Loan – (Request Mat.)” write down your desired loan term. The loan maturities available will differ depending on the type and uses of your loan. The standard maturities for the 7a are 25 years for real estate, up to 10 years for equipment, and generally up to seven years for working capital. For the 504, the maturity is usually 10 or 20 years. For disaster loans, the maximum maturity is 30 years. Be aware that the interest rate maximums set by the SBA for 7a loans vary depending on the repayment term of the loan. See our “Guide to SBA Interest Rates” for more information.
Previous SBA or Other Federal Debt
This section of SBA form 4 requires you to disclose whether you have ever requested or received any financing from the federal government. This includes student loan debt. Even if you were denied financing, you must still disclose this information. Under “Name of Agency”, write the government agency for which you applied for financing (Small Business Administration for SBA loans, or Department of Education for student loans). Next, fill out the original size of the loan, the date of your loan application, whether the loan was approved or declined, the current balance remaining on the loan, and whether you are current or past due on your payments.
This section requires you to disclose whether you hired anyone to assist you in the preparation of you SBA loan application, as well as how much you paid them. This section corresponds to SBA Form 159. See our guide to Form 159 here.
This section requires you to list all of the debt held by your business, excluding federal debt (which should be listed in the “Previous SBA or Other Federal Debt Section on page 1). You should include mortgages, credit cards, any installment debts, contracts, notes, etc. In the “To Whom Payable” section, try to fit both the name of the bank or individual, as well as the account number. Make sure to write an asterisk next to the debts that you intend to pay off using this loan. Your lender may try to compare this information to a credit report, so there should be sufficient information to identify the account. Include the original amount (for credit cards put $0), date the credit was approved, present outstanding balance, interest rate, final maturity date, monthly payment, whether the debt is secured (most credit card debt is not secured), and whether you are current or past due on payments.
This section of SBA form 4 requires you to list all of the people in key management positions, as well as all stockholders. You must account for 100% ownership, so you may need to attach another sheet (if you attach another sheet, write the applicant business name, date, and “Management” on the top of the page). The racial information is optional, and has no impact on the loan decision.
The exhibits section that begins halfway down page 2 is probably the most complicated part of SBA form 4. This section requires you to assemble lots of supporting material, and compile it with this application form. When you attach another sheet, be sure to write your business applicant name, the date, and the exhibit name (i.e. Exhibit A). This guide will go through each question one at a time to help you understand how to navigate this section.
Question 1: This question requires you to submit a form 912 for all “principals”, which includes every proprietor, general partner, officer, director, managing LLC member, owner with 20% or more equity, trustor, and any person hired by the applicant to manage the day-to-day operations. For more information on how to fill out form 912, see our guide to form 912.
Question 2 – Exhibit A: This question requires you to provide an itemized list of your collateral. Fortunately, the SBA provides a form,Schedule of Collateral Exhibit A, which will help you provide the necessary information. Use your personal name and address as they appear on your tax documents.
Section I is reserved for any real estate that you own. You must attach a copy of the deed(s) containing a full legal description of the land and its location. Following the address, provide the year you acquired the property and the original cost. For the “Market Value” you can either contact a real estate agent for an estimate, or use an online service such as Zillow.com. For the “Amount of Lien” field, put the remaining value of your mortgage. For “Name of Lienholder”, write in the name of the bank that holds your mortgage. Underneath you should describe the property, including information such as improvements, size, type of construction, use, number of stories, and present condition (you can use additional sheet if more space is required).
Section 2 of SBA form 4 is where you must index any personal property of considerable value. Anything with a value greater than $5,000 must include serial numbers. To determine “Market Value” you can use online services such as Kelley Blue Book (for cars), or ebay.com. Any property that you are still making payments on must also include the amount of debt outstanding on the item (Current Lien Balance), and the holder of the debt (Name of Lienholder).
Once you have catalogued all of your valuable possessions, you and your spouse must sign and date the form.
Question 3 – Exhibit B: This question requires you to provide a signed current balance sheet for each stockholder (with 20% or greater ownership), partner, officer, and owner. Include the assets and liabilities of the spouse and any close relatives living in the household. We recommend using SBA form 413 for this question. See our guide to Form 413 for detailed information on how to complete this form.
Question 4 – Exhibit C: This question requires you to provide financial information about your company. You must provide a balance sheet, profit and loss statement, net worth, aging of accounts receivable and payable, and 1-year earnings projection. You may wish to hire a professional to help you assemble these materials. If you do hire someone, make sure to fill out form 159 (See out guide to form 159 here).
Question 5 – Exhibit D: This question requires you to write a brief history of your company and describe the expected benefits you will receive from the loan.
Question 6 – Exhibit E: This question requires you to describe the qualifications and experience of all the people listed under Management. This can be similar to a resume, and should include a summary of the education, technical and business background of your management team.
Question 7 – Exhibit F: This question requires you to provide the names, addresses, tax I.D. number (EIN or SSN), and current personal balance sheet(s) of any co-signers and/or guarantors for the loan who are not otherwise affiliated with the business. Make sure that this information matches the information you provide on form 413.
Question 8 – Exhibit G: This section requires you to provide a list of any machinery or equipment or other non-real estate assets that you plan to purchase with your loan. Provide the cost of each item as quoted by the seller and the seller’s name and address. Try to provide the most accurate cost, rounded to the nearest dollar. This information should match the “Use of Proceeds” section on page 1.
Question 9 – Exhibit H: This question requires you to disclose if you or any officers of your company have ever been involved in bankruptcy or insolvency proceedings. If no, simply check “no”. If yes, you must provide details in a written statement.
Question 10 – Exhibit I: This question requires you to disclose if you or your business are involved in any pending lawsuits. This information should match any information provided in the “Contingent Liabilities” section of SBA form 413.
Question 11 – Exhibit J: This question requires you to disclose whether you or your spouse or any member of your household, or anyone who owns, manages or directs your business or their spouses or household members work for the SBA, Small Business Advisory Council, SCORE or ACE, any Federal Agency, or the participating lender. If yes, you must provide the name and address of the person and the office where employed. If you are applying for an SBA Express, Export Express, Small Loan Advantage, or CAPLines loan, this information should match questions 20-24 on Form 1919 (see our guide to Form 1919 here).
Question 12 – Exhibit K: This question requires you to disclose whether your business, its owners or majority stockholders own or have a controlling interest in other businesses. If this is the case, you must provide their names and the relationship with your company along with a current balance sheet and operating statement for each. This information should correspond to the “Other Assets” field in the “Assets” section on each individuals SBA form 413.
Question 13 – Exhibit L: This question requires you to disclose whether you buy from, sell to, or use the services of any concern in which someone in your company has a significant financial interest.
Question 14 – Exhibit M: This question requires you to disclose whether your business is a franchise (see SBA definition here). If it is a franchise, you must include a copy of the franchise agreement and a copy of the FTC disclosure statement supplied to you by the Franchisor. If you are applying for an SBA Express, Export Express, Small Loan Advantage, or CAPLines loan, this information should also correspond to question 9 on Form 1919.
Question 15 – Exhibit N: This question only applies to loans in which part of the proceeds will be used for construction. If you have listed funds in the “New Construction/Expansion Repair” field in the “Use of Proceeds” section on page 1, you must provide an estimated cost of the project and a statement of the source of any additional funds.
Question 16 – Exhibit O: This question also only applies to loans used for construction, and requires you to provide copies of preliminary construction plans and specifications. Be aware that final plans will be required prior to disbursement.
Question 17: This question determines whether your business is presently engaged in export trade. If you are applying for an SBA Express, Export Express, Small Loan Advantage, or CAPLines loan, this information should also correspond to question 8 on Form 1919.
Question 18: This question determines whether you will be using proceeds from this loan to support your company’s exports. If you are applying for an SBA Express, Export Express, Small Loan Advantage, or CAPLines loan, this information should also correspond to question 8 on form 1919.
Question 19: Check “yes” or “no” if you would like the SBA to provide you with information on Exporting.
The final requirement to complete SBA form 4 is the certification by each proprietor, General Partner, each Limited Partner or Stockholder owning more than 20%, Guarantor and the spouse of each of these. Each person should sign only once.
Wondering how to get an SBA loan? Click here to get our FREE Guide:
How to Apply for an SBA Loan