If you are applying for an SBA 7(a), SBA 504, or SBA Disaster Loan from the Small Business Administration (SBA), you must fill out a personal financial statement known as SBA Form 413. Your SBA lender will use your personal financial information to help determine your company’s ability to repay a loan and its creditworthiness.
To complete SBA Form 413 quickly and easily, have your personal and company financial information organized and available. You should consider having your financial expert or accountant assist in the completion of this document.
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Who Needs To Fill Out Form 413?
Businesses applying for an SBA 7(a) loan, SBA 504 loan, or an SBA Disaster Loan must include a personal financial statement in their loan application package. Each of the following people must complete and provide their own personal financial statement:
- The proprietor of the business
- Each general partner
- Each owner or limited partner with 20% or more equity interest in the business
- Any person or entity providing a guarantee on the loan
If the type of SBA loan you apply for requires you to provide SBA Form 413, and you file a joint tax return, your spouse’s information must be included. This doesn’t mean your spouse will be a guarantor on the loan, but including your spouse’s financial information informs the SBA and your lender that you have joint assets and liabilities. Your combined assets and liabilities must be reported unless a legal document, such as a prenuptial agreement, specifically separates certain assets.
Before Filling Out Form, Gather Financial Documents
Completing the form will be easier if you gather your financial documents in advance. Collect paperwork that reflects your assets and liabilities from the last full month. For example, if you fill out the form on Dec. 8, 2023, you should gather documents with information as of Nov. 30, 2023.
The financial information you will need includes:
- Checking and savings account statements
- Individual retirement account (IRA), 401(k), and other retirement account statements
- Life insurance documents showing current cash surrender value
- Stocks, bonds, and other investment documents showing current value
- Pay stub showing current annual salary
- Statements for disability income, pensions, real estate income, or other sources of income
- Mortgage statements, auto loan statements, credit card statements, and statements for other types of loans showing your account number, payment amount, and current balance
Once collected, you’ll want to store this paperwork in an accessible location, as you will likely need to reference it throughout the SBA loan process. With this preliminary work done, you’re ready to begin filling out the rest of the SBA personal financial statement form. If you have all your paperwork gathered and organized, filling out the rest of the form is relatively simple. Depending on how many assets and liabilities you have, SBA Form 413 could take as little as 15 minutes to complete.
Complete the Sections of Form 413
Once you have all of your documents gathered, you are ready to complete Form 413. Follow each section below for detailed instructions on how to complete the form.
Choose the Loan Type or Program
On the first page, you will check all the boxes that apply to your loan:
- Check the first box if it is an SBA 7(a) or 504 loan or a surety bond.
- Check the second box if it is a disaster business loan application.
- Check the third box if it is a Women Owned Small Business (WOSB) Federal Contracting Program.
- Check the fourth box if it is an 8(a) Business Development Program.
You may end up checking more than one box. See the image below for details on each section of page one.
Page 1 of SBA Form 413. Check all boxes that apply.
Fill Out Your Personal and Business Information
The top portion of page two requires your name, address, phone numbers, and business name. This is followed by a summary section for your assets and liabilities. As strange as it may seem, it’s best to complete the assets and liabilities sections last. These sections summarize information contained in the other sections throughout the form. Complete sections one through eight first, then use the information from those sections to total your assets and liabilities.
Top section of page two of SBA Form 413. Includes personal information, assets, and liabilities. Fill out the assets and liabilities last.
Section 1: List Sources of Income & Contingent Liabilities
Section 1 of SBA Form 413
In this section, you’ll list your income sources and contingent liabilities. Potential income sources include income you expect to receive on a regular and recurring basis. Contingent liabilities are debts that become your responsibility if and when something else happens. For example, if you cosign a loan to buy a vehicle for someone else, you become responsible if the other person doesn’t pay. In this section, you’re summarizing the contingent liabilities you will list in the Other Liabilities section (Section 7).
Sources of Income
Instructions for providing this information and definitions of terms used on this form are:
- Salary: Include all wage income for you and your spouse. Only include the amount reported on your W-2 or 1099 tax forms. If your company is a partnership or an LLC, do not include income you take out of the company through distributions, withdrawals, or guaranteed payments in this section.
- Net investment income: This section includes any income from interest earned on savings accounts, dividends and interest earned on stocks and bonds, and recurring capital gains or losses on the sale of investments.
- Real estate income: This is your annual net operating income (NOI) from rental properties after expenses.
- Other income: This can include child support, pension, distributions, dividends, or guaranteed payments you receive from the company on a regular or recurring basis. Describe this income in detail in the box provided beneath Section 1.
Contingent Liabilities
Instructions for providing this information and definitions of terms used on this form are:
- As endorser or co-maker: List the total potential outstanding debt on any loans you’ve co-signed or guaranteed.
- Legal claims and judgments: List any potential debts associated with legal judgments and claims.
- Provision for federal income tax: List any money you are setting aside to pay expected federal income taxes.
- Other special debt: This is another catch-all for any other potential debts not already listed.
Section 2: Include Notes Payable to Banks and Others
Section 2 of SBA Form 413
This section details all your debts, such as credit cards, personal loans, and installment loans. We recommend reviewing your credit report to make sure you don’t miss anything. Established businesses may also want to double-check their business credit reports.
If you don’t have enough space to list all your loans, attach another sheet of paper with the required information. You can use as many supplemental pages as needed. If you do so, make sure they all include the “as of” date on your SBA personal financial statement, reference Section 2, include the name of the business applicant, and are signed by you and your spouse.
Instructions for providing this information and definitions of terms used in this section are:
- Name and address of noteholders: Enter the names and addresses of the banks that hold your debt. If you have multiple loans or credit cards from the same bank, list the last four numbers of the account numbers so that they can be matched with a credit report.
- Original balance: List the total amount borrowed when the account was first established. For credit cards, put $0.
- Current balance: List the amount that you currently owe. Put $0 for credit cards if you pay your balance in full each month.
- Payment amount: Enter the minimum payment that you have to pay with each statement. For credit cards, you can write “varies.”
- Frequency: Indicate how often payments are made. This is typically monthly.
- How secured or endorsed/Type of collateral: Describe the object or property used as collateral, such as make and model of the automobile securing the loan. If collateral was not required, write “unsecured” in the text box. Most credit cards are unsecured.
Section 3: Mention Your Stocks and Bonds
Section 3 of SBA Form 413
In this section, you’ll list the marketable securities you and your spouse own. This does not include retirement savings as that will be reported in another section of the form. If needed, you can attach supplemental pages with more entries.
Instructions for providing this information and definitions of terms used in this section are:
- Number of shares: List the total number of shares you own
- Name of security: Enter the name of the stock or bond
- Cost: List the initial cost of your purchase
- Market value quotation/Exchange: Enter the value of the security on the “as of” date you selected
- Date of quotation/Exchange: Report the date of the value you reported (the same as the “as of” date).
- Total value: Multiply the market value of each security by the number of shares you own, and list this amount
Section 4: Include Real Estate Owned
Section 4 of Form 413.
This section is where you’ll provide a detailed description of all the real estate you own in your personal name. List any property reported on your personal tax return. Property A is your primary residence if you own it. If you own more than three properties, attach supplemental sheets or a “schedule of real estate” that identifies the same information as required on the SBA personal financial statement form.
Instructions for providing this information and definitions of terms used in this section of the form are:
- Type of property: List the type of property, such as “primary residence,” “undeveloped lot,” or “investment property”
- Address: List the physical address of the property
- Date of purchase: Use the date on your mortgage bill of sale
- Original cost: List the purchase price
- Present market value: Use the current appraised value of the property if you were to sell the property today; you can obtain an estimate by calling a broker or using an online tool like Zillow.
- Name and address of mortgage holder: Enter the name and address of the lender that holds the mortgage on the property
- Mortgage account number: The number of the loan with the financial institution
- Mortgage balance: The remaining principal balance left to be paid on the mortgage
- Amount of payment per month/year: Enter your monthly/yearly mortgage payment
- Status of mortgage: Indicate the current repayment status of your mortgage, such as current, foreclosure, paid in full
Section 5: List Any Other Personal Property and Other Assets
Section 5 of Form 413
In this section, you’ll report personal property of significant value. This includes property, such as jewelry, IRAs or other retirement accounts, cars, and recreational vehicles. For cars, include the make, model, and year along with a quick estimate of current value from a tool, such as Kelley Blue Book.
You won’t have to show documentation on the value of your business right away. However, you should be prepared to provide it in the event your lender asks for it. You can pay a consultant to provide an official business valuation, or you can estimate the value of your business and document how you made your calculation.
Section 6: Describe Any Unpaid Taxes
Section 6 of SBA Form 413
This section is available for you to provide a detailed description of any federal, state, or local taxes you owe. You should also state whether the unpaid taxes are current or delinquent. Report taxes you owe to a foreign government in the Other Liabilities section of the form.
The SBA requires you to be current on all federal, state, and local taxes before it will approve a loan. The only exception is if you have delinquent federal income taxes with an IRS-approved payment plan. The SBA also doesn’t allow you to use loan proceeds to pay for past due taxes, such as income, payroll, real estate property, or sales.
Section 7: Include Any Other Liabilities
Section 7 of SBA Form 413
This section of SBA Form 413 is a catch-all where you can list any liabilities not previously disclosed on the form and described in detail. Some examples of the types of liabilities that can be found here are:
- Co-signed or guaranteed obligations: If you are obligated on another person’s debt as a co-signer or guarantor, you should list those potential liabilities in this section. You will ultimately report this as a contingent liability.
- Debts to foreign governments: Any debts owed to foreign governments, typically taxes, are disclosed here even though they are a tax obligation.
- Debts that come from private agreements: If you made a significant financial agreement to pay someone, with or without documentation, then you should list it here.
- Outstanding lawsuits: If you’re currently being sued, but a judgment hasn’t been entered, then you should list your potential liability in this section.
You don’t want to miss any liabilities, as your loan provider will likely find them in your credit report, and they could think you’re trying to hide something. If you’re not sure where to put a liability on the form, then make sure it’s included in this section.
Section 8: Life Insurance Held
Section 8 of SBA Form 413
You need to list all life insurance you or your spouse currently holds in this section of the form. List all your policies, including term, whole life, and variable life insurance. Provide the face value (death benefit) of your policy that would be provided to your beneficiaries if you die, as well as the cash surrender value of whole life insurance policies. Also, list the full names of all policy beneficiaries and the name of the insurance company that carries your insurance policies. The insurance company may not be the agent or broker you worked with to establish the policy.
Summarize Your Assets
On the second page of the form, the Assets section not only summarizes the information you provided earlier as you filled out the form but also includes your cash on hand and savings account balances.
When completing this section, make sure you round up to the nearest dollar. You’ll need to list the following assets:
- Cash on hand and in banks
- Savings accounts
- IRA or other retirement accounts
- Accounts and notes receivables
- Life insurance—cash surrender value only
- Stocks and bonds
- Real estate
- Automobiles
- Other personal property
- Other assets
Add up the total of all your assets included in the prior line items. Double-check your math to make sure it adds up properly!
Summarize Your Liabilities
Liabilities section of Form 413
The Liabilities section not only summarizes the information you provided in the prior steps but also includes your accounts payable. With accounts payable, report the total amount of products and services purchased on credit or on a regular payment basis, excluding those using credit cards or personal lines of credit.
When completing this section, make sure you round up to the nearest dollar. You’ll need to list the following liabilities:
- Accounts payable
- Notes payable to banks and others
- Installment account (auto), both monthly payments and total owed
- Installment account (other), both monthly payments and total owed
- Loans against life insurance (total amount)
- Mortgages on real estate
- Unpaid taxes
- Other liabilities
Then, follow the instructions for the last three items to complete this section:
- Total liabilities: Provide the sum of all your liabilities included in the prior line items above. Don’t forget to check your math.
- Net worth: While net worth isn’t a liability, it is reported in this section. You can arrive at your net worth by calculating your total assets reported in the Assets section of the form minus your total liabilities reported on the prior line.
- Total liabilities and net worth: Add your total liabilities with your net worth. Make sure this matches the number you reported for total assets in the Assets section of the form.
Don’t Forget to Sign the Form
Once you complete the summary of assets and liabilities, and each person listed on the SBA personal financial statement has completed and signed the certification on page 3, you’re done preparing SBA Form 413. You’ll provide this form to your lender with your SBA loan application and other supporting documents.
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Frequently Asked Questions (FAQs)
The SBA Form 413 is a personal financial statement that is filled out when applying for an SBA 7(a), SBA 504, or SBA Disaster loan.
Gather all of your financial documents and fill out each section. Save the assets and liabilities for last as you will be able to use your other sections to help fill out those sections at the end. Have your company’s financial expert help fill these forms out. Your SBA loan provider can also give you guidance on any SBA forms that need to be completed.
The SBA form you will need to fill out is SBA Form 1368. You will need to complete IRS Form 4506-C to give permission for the SBA to obtain your tax return. You will also need any financial documents that show that your company was negatively impacted by a disaster.
Bottom Line
Once you’re finished completing SBA Form 413, sign and date the form, then assemble it in a binder with your supporting documents. Don’t include anything you cannot support with documentation, as your lender will likely ask you for some of it. Be prepared to provide your lender with copies upon request. And for more guidance on the business loan application process, see our guide on how to get a small business loan.
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