What is SBA Form 413 (Personal Financial Statement)?
The Short Answer
SBA Form 413 (Personal Financial Statement) explained simply
SBA Form 413 is a standard document used by the Small Business Administration (SBA) to get a clear picture of an individual's financial situation. When you apply for an SBA loan, whether it's for starting a business, expanding an existing one, or buying a business, you'll need to fill this out. It asks for details about everything you own (assets) and everything you owe (liabilities). This includes things like your cash, investments, real estate, vehicles, and personal property, as well as mortgages, credit card debt, and other loans. The form helps the SBA and lenders understand your personal financial strength and how it relates to your ability to repay a business loan.
Real-World Example
Applying for an SBA Loan
Let's say you're buying a coffee shop and need an SBA loan. The lender will ask you to complete SBA Form 413. You'll list your home's value, your savings account balance, and any stocks you own. Then, you'll list your mortgage, car loan, and credit card balances. The form calculates your total assets, total liabilities, and your net worth. This gives the lender a snapshot of your personal financial health, which is a key factor in their decision to approve your loan.
Why this matters
SBA Form 413 matters because it's a critical part of getting an SBA loan. Lenders use it to see if you have the personal financial stability to support your business loan. It helps them understand your overall financial picture, not just your business finances. A strong personal financial statement can increase your chances of loan approval and show lenders you're a reliable borrower.
Make sure all information on your SBA Form 413 is accurate and up-to-date. Any discrepancies can delay your loan application or even lead to rejection. Be thorough and honest.
Make sure all information on your SBA Form 413 is accurate and up-to-date. Any discrepancies can delay your loan application or even lead to rejection. Be thorough and honest.
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