--- title: What Financial Information Does the Bank Need to Consider a Loan? description: Discover what financial information banks require for loans, how to prepare, and the key factors that influence lending decisions. 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[Financing Process](https://www.libertysavingsbank.com/mortgages/first-home-buyers-guide/financing-process/) - [What is Refinancing?](https://www.libertysavingsbank.com/mortgages/first-home-buyers-guide/purchasing-or-refinancing/) - [Frequently Asked Questions](https://www.libertysavingsbank.com/mortgages/first-home-buyers-guide/frequently-asked-questions/) - [Mortgage Calculators](https://www.libertysavingsbank.com/mortgages/first-home-buyers-guide/mortgage-calculators/) - [Home Loan Teams](https://www.libertysavingsbank.com/mortgages/mortgage-loan-officers/) - [Overview](http://libertysavingsbank.com/mortgages/mortgage-loan-officers/) - [Bradenton/Wildewood Home Loan Team](https://value.libertysavingsbank.com/wildewood-mortgage-team) - [Sarasota/Stickney Home Loan Team](https://value.libertysavingsbank.com/stickney-mortgage-team-1) - [Sarasota/Square South Home Loan Team](https://value.libertysavingsbank.com/square-south-mortgage-team) - [Lakewood Ranch/Home Loan Team](https://value.libertysavingsbank.com/lakewood-ranch-florida-mortgage-team) - 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[Apply Now](https://lsbmtg.mymortgage-online.com/?loanapp&siteid=6096984036&workFlowId=61437) - [Buying a Home](https://www.libertysavingsbank.com/mortgages/mortgage-loans-2/buying-a-home/) - [Home Equity Line of Credit - HELOC](https://www.libertysavingsbank.com/mortgages/mortgage-loans-2/home-equity-line-of-credit_heloc/) - [Refinancing a Home](https://value.libertysavingsbank.com/compare-and-save) - [Fixed Rate Mortgage](https://www.libertysavingsbank.com/mortgages/mortgage-loans-2/fixed-rate-mortgage/) - [Adjustable Rate Mortgage](https://www.libertysavingsbank.com/mortgages/mortgage-loans-2/adjustable-rate-mortgage/) - [Jumbo Loans](https://www.libertysavingsbank.com/mortgages/mortgage-loans-2/jumbo-loans/) - [Mortgage Calculators](https://www.libertysavingsbank.com/mortgages/first-home-buyers-guide/mortgage-calculators/) - [Senior Living](https://value.libertysavingsbank.com/senior-living) - First Home Buyers Guide - [Overview](https://www.libertysavingsbank.com/mortgages/first-home-buyers-guide/) - [Glossary of Mortgage Terms](https://www.libertysavingsbank.com/mortgages/first-home-buyers-guide/glossary-of-mortgage-terms/) - [Financing Process](https://www.libertysavingsbank.com/mortgages/first-home-buyers-guide/financing-process/) - [What is Refinancing?](https://www.libertysavingsbank.com/mortgages/first-home-buyers-guide/purchasing-or-refinancing/) - [Frequently Asked Questions](https://www.libertysavingsbank.com/mortgages/first-home-buyers-guide/frequently-asked-questions/) - [Mortgage Calculators](https://www.libertysavingsbank.com/mortgages/first-home-buyers-guide/mortgage-calculators/) - [Home Loan Teams](https://www.libertysavingsbank.com/mortgages/mortgage-loan-officers/) - [Overview](http://libertysavingsbank.com/mortgages/mortgage-loan-officers/) - [Bradenton/Wildewood Home Loan Team](https://value.libertysavingsbank.com/wildewood-mortgage-team) - [Sarasota/Stickney Home Loan Team](https://value.libertysavingsbank.com/stickney-mortgage-team-1) - [Sarasota/Square South Home Loan Team](https://value.libertysavingsbank.com/square-south-mortgage-team) - [Lakewood Ranch/Home Loan Team](https://value.libertysavingsbank.com/lakewood-ranch-florida-mortgage-team) - [Venice/Home Loan Team](https://value.libertysavingsbank.com/jacaranda-mortgage-team-2) - [1098 Mortgage Interest Statement](https://www.libertysavingsbank.com/mortgages/1098-mortgage-interest-statement/) - [Personal Loans](https://value.libertysavingsbank.com/personal-loans-florida) - [Commercial/Business Loans](https://value.libertysavingsbank.com/commercial-business-lending) - Support - Getting Started - [About Online and Mobile Banking](https://www.libertysavingsbank.com/help/getting-started/about-online-and-mobile-banking/) - [Installing the Mobile Banking App](https://www.libertysavingsbank.com/help/getting-started/installing-the-mobile-banking-app/) - [Accessing the Online Banking Site](https://www.libertysavingsbank.com/help/getting-started/accessing-the-online-banking-site/) - [Logging In](https://www.libertysavingsbank.com/help/getting-started/logging-in-overview/logging-in-for-the-first-time/) - [Logging Out Overview](https://www.libertysavingsbank.com/help/getting-started/logging-off-overview/logging-off-voluntarily/) - The Homepage - [Using the Menu](https://www.libertysavingsbank.com/help/the-home-page/using-the-menu/) - [Viewing Accounts](https://www.libertysavingsbank.com/help/the-home-page/viewing-accounts/) - [Viewing the Sidebar](https://www.libertysavingsbank.com/help/the-home-page/viewing-the-sidebar/) - [Account Information on the Home Page](https://www.libertysavingsbank.com/help/the-home-page/account-information-on-the-home-page/) - [Account Details Overview](https://www.libertysavingsbank.com/help/the-home-page/account-details-overview/) - Online Activity - [Creating Custom Views in the Online Activity Center](https://www.libertysavingsbank.com/help/online-activity/creating-custom-views-in-the-activity-center/) - [Sorting Transactions in the Online Activity Center](https://www.libertysavingsbank.com/help/online-activity/sorting-transactions-in-the-activity-center/) - [Viewing Transaction Details in the Activity Center Overview](https://www.libertysavingsbank.com/help/online-activity/viewing-transaction-details-in-the-activity-center-overview/) - [Copying A Transaction](https://www.libertysavingsbank.com/help/online-activity/approving-transactions/) - [Sending a Message About a Transaction in the Activity Center](https://www.libertysavingsbank.com/help/online-activity/sending-a-message-about-a-transaction-in-the-activity-center/) - [Printing Transaction Details from the Activity Center](https://www.libertysavingsbank.com/help/online-activity/printing-transaction-details-from-the-activity-center/) - [Exporting by Transaction Type in the Activity Center](https://www.libertysavingsbank.com/help/online-activity/exporting-by-transaction-type-in-the-activity-center/) - Personal Banking - [Enrolling for Financial Tools](https://www.libertysavingsbank.com/help/personal-banking/enrolling-in-cpfm/) - [Classic Bill Pay](https://value.libertysavingsbank.com/libertycard-onfile-and-instapay) - [Depositing a Check on Your Mobile Device](https://www.libertysavingsbank.com/help/personal-banking/depositing-a-check-on-your-mobile-device/) - [Managing Manual Accounts](https://www.libertysavingsbank.com/help/personal-banking/managing-manual-accounts/) - [Financial Tools: Using PFM Widgets](https://www.libertysavingsbank.com/help/personal-banking/using-pfm-widgets/) - Business Banking - [Canceling Pending Transaction](https://www.libertysavingsbank.com/help/business-banking/canceling-pending-transaction/) - [Approving Transactions](https://www.libertysavingsbank.com/help/business-banking/approving-transactions/) - [Explainer Videos](https://www.libertysavingsbank.com/help/explainer-videos/) ![FDIC Logo](https://news.libertysavingsbank.com/hubfs/logo-fdic.svg) FDIC-Insured - Backed by the full faith and credit of the U.S. Government # News & Insights [Home](https://www.libertysavingsbank.com/) News & Insights ## What Financial Information Does the Bank Need to Consider a Loan? ![](https://news.libertysavingsbank.com/hubfs/Corporate%20Headshot%20Over%20Financial%20Documents.png) I started in banking at 18, as a teller. Early on, the bank's president, Mr. David, asked if I'd considered making a career of it. Then he told me something I've carried for 46 years: *"Scott, the technology will change, the processes will change, but what won't change is people want to do banking with people they trust."* He was right. And here's the part people don't always expect: trust runs both directions. When you ask a bank to lend you money, we're being asked to trust you with our depositors' money. Your financial information is how you earn that trust on paper. That's why the document list can feel long. It isn't busywork, and it isn't the bank looking for a reason to say no. Every item answers one of a few simple questions: 1. Can the business repay the loan from its normal cash flow? 2. Has it shown it can do that over time, not just in one good year? 3. If something goes wrong, is there a backup way to get repaid? 4. Do the owners stand behind the business? Below is what most banks ask for, what we're actually looking for in those documents, and how to prepare. I've also brought in two of my colleagues here at Liberty: Sally Daisomont, a commercial loan officer with 35 years of experience in Sarasota-Manatee lending, and Tracy Wolfe, who brings 25 years of community banking experience and a relationship-focused approach to serving business clients through Treasury Management. ## The financial information most banks ask for Every bank's list is a little different, and it changes with the size and type of loan. But for most business loans, you can expect to be asked for some version of the following. Lists from sources like the[Illinois Small Business Development Center's lending guide](https://sbdc.illinois.gov/content/dam/soi/en/web/sbdc/documents/il-sbdc-english-qa-commercial-lend-2025-apr.pdf) line up closely with what I've seen across my career. | What we ask for | Typical scope | What it tells us | | --- | --- | --- | | Business tax returns | Usually the last 2–3 years | Your track record, as reported to the IRS | | Year-to-date profit and loss statement | Current year, recent month-end | How this year compares with past years | | Balance sheet | Same date as the P&L | What the business owns and owes right now | | Debt schedule | Every current loan, lease and line | What you already pay each month, and to whom | | Business bank statements | Often several recent months | How cash actually moves through the business | | Personal tax returns | Each significant owner | Owner income, and money flowing between owner and business | | Personal financial statement | Each significant owner | Owners' assets, debts and net worth | | The request itself | Amount, purpose, timing | What the money is for and how it pays for itself | | Ownership and legal documents | Articles, operating agreement, licenses | Who owns the business and who can sign for it | A few notes on the less obvious items: The personal financial statement. Most banks have their own form. If you want to see what one looks like, the SBA's version,[Form 413](https://www.sba.gov/managing-business/forms/small-business-forms/financial-assistance-forms/personal-financial-statement), lists the same kinds of things: cash, retirement accounts, real estate, other debts. Small businesses and their owners are closely tied, so we look at both. Verifying with the IRS. Don't be surprised if you're asked to sign a form that lets the bank confirm your returns directly with the IRS. The IRS runs an[Income Verification Express Service](https://www.irs.gov/individuals/income-verification-express-service) for exactly this, and it only releases records with your consent. It's routine. The request. This is the one people skip. *"I need $250,000"* is a number. "*I need $250,000 for a second truck and crew, which should add this much revenue"* is a plan. Bring the plan. ## What we're actually looking for in those numbers The documents are the raw material. What matters is what they add up to. My colleague Sally Daisomont boils it down to four things a lender looks at, whether you're starting, expanding or refinancing: 1. **You pay your bills.** On time, to vendors, landlords and other lenders. 2. **Your credit is in good shape.** Business and personal. 3. **The business shows a profit.** On the returns, not just in your head. 4. **You have a healthy debt service coverage ratio.** More on that below. I'd add one more that doesn't fit on a spreadsheet: *can you explain your own numbers?* When an owner can walk me through why revenue dipped one year or why margins improved the next, that tells me they're running the business, not the other way around. ### Debt service coverage ratio, in plain English If there's one number to understand before you walk into a bank, it's this one. Debt service coverage ratio (DSCR) compares the cash your business generates with the loan payments it has to make. As the[Corporate Finance Institute](https://www.corporatefinanceinstitute.com/resources/knowledge/finance/debt-service-coverage-ratio/) describes it, it measures how easily operating cash flow covers a year's principal and interest. ![DSCR Formula Infographic](https://news.libertysavingsbank.com/hs-fs/hubfs/DSCR%20Formula%20Infographic.png?width=2172&height=724&name=DSCR%20Formula%20Infographic.png) Here's a simple hypothetical. Say your business has $150,000 a year available after operating expenses, and all your loan payments, including the new one, total $100,000 a year. Your DSCR is 1.5. You'd cover your payments one and a half times over. A DSCR of 1.0 means you'd have exactly enough and not a dollar to spare, which is why lenders want a cushion. In commercial real estate,[one industry training resource](https://www.c-loans.com/debt-service-coverage-ratio) cites 1.25 as a common minimum, and asks for more on riskier properties like hotels. Every bank and every loan type sets its own threshold, so treat that as a reference point, not a rule. The practical takeaway: before you apply, take your last year's numbers, add the payment on the loan you want, and see how much room is left. If it's thin, it's better to know now. ## Two places good businesses trip up ### Your tax return tells a different story than you think This is Sally's point, and it's one of the most common surprises we see. Plenty of owners work hard with their accountant to keep taxable income as low as possible. That's understandable. But the same deductions that shrink your tax bill also shrink the profit a lender sees. If the return shows a loss, it's hard to justify new debt, no matter how busy the business looked that year. Sally's advice is to line up your tax planning with your borrowing plans before you file, not after. If you expect to need financing in the next year or two, have that conversation with your tax professional and your banker at the same time. A lender can sometimes add back certain non-cash or one-time expenses when analyzing cash flow, but that's a judgment call on each file, not something to count on. Talk to your tax professional about what's right for your situation; this article isn't tax advice. ### Your bank statements are the unfiltered version Tax returns and financial statements are summaries. Bank statements are the week-by-week record of what actually happened. This is where Tracy Wolfe's work comes in. Tracy leads treasury management for our business clients, helping them set up how money moves in and out of their accounts. Here's how she puts it: "Bank statements tell us a lot about how a business operates beyond just the balance in the account. We can see how the money moves in and out, how consistently revenue comes in, and how the business manages its day-to-day cash flow. From a treasury management perspective, it's about understanding those patterns and helping business owners find better ways to manage their money. Whether that's improving collections, streamlining payments, or making cash more accessible, the right tools can make a real difference in how efficiently a business operates." Two habits make your statements much easier to underwrite: - **Keep business and personal money separate.** When personal expenses run through the business account, or business deposits land in a personal one, we have to untangle it before we can analyze anything. - **Know your seasonal pattern.** Many businesses around Sarasota and Manatee look very different in February than in August. That's normal, and a good banker here expects it. What helps is showing you've planned for the slow months. ## What else we may ask for, depending on the loan The core list above applies to almost every request. The purpose of the loan adds a few items, because each type of loan has its own source of repayment and its own collateral. | If you're financing... | Expect to also provide | Why | | --- | --- | --- | | A commercial building | Purchase contract, property details, proof of insurance; the bank typically orders an appraisal | The property is the collateral, so we need to know its value and that it's protected | | An income-producing property | Rent roll and current leases | The tenants' rent is what repays the loan | | Equipment or vehicles | A quote or invoice with specs | The equipment usually secures the loan | | A line of credit | Accounts receivable and payable aging reports, sometimes inventory reports | A line is repaid from collections, so we look at who owes you and how fast they pay | | Buying an existing business | The seller's financials and tax returns, plus the purchase agreement | We're lending against the business you're buying, not just yours | On lines of credit specifically, Sally makes a point I agree with completely: set one up while business is strong. If you wait until a slow month to apply, you're asking with weaker numbers and less room to negotiate. And if you're thinking about buying property, talk to your banker before you sign the contract. It's much easier to structure a deal right from the start than to fix it later. ## How to get ready before you apply You don't need perfect financials to start a conversation with a banker. You do need organized ones to finish it. ### Here's a checklist to work through: - Pull your last 2–3 years of business and personal tax returns - Ask your bookkeeper or CPA for a current profit and loss statement and balance sheet - List every loan, lease and line of credit you have, with balances and monthly payments - Download recent business bank statements - Fill out a personal financial statement for each owner - Gather your articles of organization or incorporation, operating agreement and licenses - Write one page on what the money is for, how much you need and how it will pay for itself - Run your own rough DSCR with the new payment included - Be ready to explain anything unusual: a down year, a big one-time expense, a gap ## The conversation matters as much as the paperwork As I like to say, capital is the lifeblood of the economy. When a local business gets the financing it needs, it hires, it buys from other local businesses, and the whole community feels it. That's the part of this job I've always loved. But the best loans I've made didn't start with a stack of documents. They started with a conversation about what the owner was trying to build. The paperwork just confirms the story. So if you're thinking about financing, even a year out, come talk to us at any of our 5 financial centers. Bring what you have. We'll tell you what else you'll need and where you stand. And if you haven't heard from your banker lately, give me a call. I will answer, or return your call or email. *All loans are subject to credit approval. This article is general information and not tax, legal or financial advice. Talk with your tax professional about your specific situation.* [![Scott Holmer Author Bio Banner](https://news.libertysavingsbank.com/hs-fs/hubfs/Scott%20Holmer%20Author%20Bio%20Banner.png?width=1920&height=819&name=Scott%20Holmer%20Author%20Bio%20Banner.png)](https://value.libertysavingsbank.com/commercial-business-lending) #### Subscribe for Business Banking Insights *“*Many, many times I’ve had people knock on my door: ‘Hey, come try this bank.’ But the service I get from Liberty Bank is unbelievable. If I need something done, it’s done right away.*”* **Richard – Richards Plumbing** ## *You can trust liberty* ## Liberty has hundreds of ★★★★★ reviews. Backed by the FDIC. Bauer recommended. 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APY= Annual Percentage Yield Copyright © 2023, Liberty Savings Bank, F.S.B., Member FDIC, Equal Housing Lender, NMLS #408905, All Rights Reserved. ```json { "@context" : "https://schema.org", "@type" : "BlogPosting", "author" : { "@type" : "Person", "name" : "Scott Holmer", "url" : "https://news.libertysavingsbank.com/blog/author/scott-holmer" }, "dateModified" : "2026-11-04T14:34:44.588Z", "datePublished" : "2026-11-04T14:34:44.000Z", "headline" : "What Financial Information Does the Bank Need to Consider a Loan?", "image" : [ "https://news.libertysavingsbank.com/hubfs/Corporate%20Headshot%20Over%20Financial%20Documents.png" ], "mainEntityOfPage" : { "@id" : "https://news.libertysavingsbank.com/blog/what-financial-information-does-the-bank-need-to-consider-a-loan", "@type" : "WebPage" }, "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "/hs/hsstatic/content_shared_assets/static-1.4091/img/vast.png" }, "name" : "Liberty Savings Bank" } } ```