Stage 4: Closing
As the loan enters its final stages, the lender sends the borrower a second document checklist. Unlike the initial request, which focused on financial and background documents for evaluating the loan, this request focuses on the operational and legal items needed to actually close and fund it – insurance, licenses, updated financials, and similar items.
This is the last round of documents the lender will request. Everything they still need to finalize the loan will be on this list, so it’s worth reviewing it carefully and starting immediately. Some items – particularly insurance and licenses – may involve coordination with third parties on their own timelines.
Commonly Requested Documents
The exact list varies by lender and deal, but most B&I borrowers can expect the following:
• Current Financial Statements
Weeks or months have passed since the initial submission, so the lender needs updated numbers to confirm the business’s financial position hasn’t materially changed. This typically means a current year-to-date profit and loss statement and an updated balance sheet.
• Insurance
Proof of adequate insurance coverage on the business, its assets, and the property (if applicable). At a minimum, lenders usually require general liability, property insurance, and workers’ compensation. Depending on the business type, additional coverage may be required, like environmental liability for gas stations, liquor liability for restaurants, flood insurance for properties in flood zones, and so on. Getting the right coverage in place can take time, so engaging your insurance agent early is important. You don’t want to delay the loan process when you’re so close to the end!
• Licenses
Copies of all business licenses, permits, and certifications required to operate, such as business licenses, health department permits, liquor licenses, professional certifications, or any other regulatory approvals relevant to the business. The lender needs confirmation that the business will be fully licensed and in compliance at the time of closing.
• Equipment List
An itemized list of the business’s significant equipment with estimated values. For a gas station, this might include fuel dispensers, underground storage tanks, point-of-sale systems, and refrigeration units. The lender uses this to assess collateral value and verify that the business has everything it needs to operate.
