To get a Las Vegas business ready for a loan, bring your books current, prepare three years of financial statements and tax returns, and show the lender that the business produces enough cash to repay the debt. Lenders approve loans based on verified numbers, so the quality of your bookkeeping often decides how quickly an application moves.
What do lenders ask for?
| Document | What the lender learns |
|---|---|
| Business tax returns for the last three years | History of income and consistency with your statements |
| Year-to-date Profit and Loss statement and Balance Sheet | Current performance and financial position |
| Business debt schedule | Existing loans, payments, and balances |
| Accounts receivable and accounts payable aging | How quickly you collect and pay |
| Personal financial statement and personal tax returns for each owner | Owner strength behind the business |
| Projections for one to three years | How the loan will be repaid |
| Business license and formation documents | That the business is in good standing with Nevada |
What numbers do lenders look at?
- Debt service coverage ratio. Cash available to pay debt divided by the annual loan payments. Many lenders look for 1.25 or higher.
- Debt to equity. How much of the business is financed by borrowing.
- Current ratio. Current assets divided by current liabilities.
- Trends. Revenue and profit over three years.
- Owner credit. Personal credit history of the owners.
What loan options do Las Vegas businesses use?
- SBA 7(a) loans. General-purpose loans made by banks and partly guaranteed by the Small Business Administration.
- SBA 504 loans. Long-term financing for real estate and major equipment.
- SBA microloans. Smaller loans made through nonprofit lenders.
- Bank lines of credit. Short-term borrowing for seasonal cash needs.
- Equipment financing. Loans secured by the equipment purchased.
Which Nevada resources can help?
- The Nevada Small Business Development Center offers free advising on loan preparation and business planning.
- The SBA Nevada District Office in Las Vegas lists participating lenders and programs.
- SCORE provides volunteer business mentors in Southern Nevada.
- The Vegas Chamber connects members with local banks and credit unions.
How do you get your books loan-ready?
- Reconcile every account through the most recent month.
- Separate personal expenses from the business.
- Confirm that your financial statements agree with your filed tax returns, and be ready to explain any difference.
- Clean up old receivables and unrecorded liabilities.
- Prepare a debt schedule that matches the Balance Sheet.
- Build projections that show how the loan payments will be covered.
- Renew your Nevada state business license and local license so the business is in good standing.
What slows a loan application down?
- Financial statements that do not match the tax returns
- Books that are months behind
- Personal spending run through the business
- Missing or late tax filings
- Projections with no support behind the assumptions
How long does preparation take?
A business with current, reconciled books can assemble a loan package in one to two weeks. A business that needs cleanup first should allow one to three months, so start before the money is needed.
Common questions
Requirements vary by lender and loan type. Lenders weigh the owner’s personal credit alongside the cash flow, collateral, and history of the business.
The debt service coverage ratio is the cash a business has available to pay debt divided by its annual loan payments. A ratio of 1.25 means the business produces 25 percent more cash than the payments require.
Lenders require current financial statements. Books that are behind should be brought up to date before applying, which catch-up bookkeeping can do.
A fractional CFO or experienced accountant can prepare the financial statements, debt schedule, and projections. Sunderland Valley Enterprises prepares loan packages for Las Vegas businesses.
See our fractional CFO services in Las Vegas, which include lender packages.
This article is general information for Nevada business owners. Filing rules and deadlines change, so confirm the requirements for your business with the agency involved or with your CPA.
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