What is SBA From 912, and Do You Need to Complete It?
Small Business Administration Form 912 is a form that checks the individual’s personal history when requesting a loan. The purpose of small business loans is to aid their growth, but there are certain eligibility conditions that the business owner has to meet.
This form is filled out to get an idea of the criminal standing of the person applying for the business loan. However, if you do not have a criminal history, you need not fill out this form since many lenders do not require you to submit it. So, make sure to ask your lender if this form is needed.
Other employees might also have to complete this form apart from the person submitting the business loan application. This would depend on the structure of your business.
● In the case of a sole proprietorship, only the owner of the business has to submit this form.
● A cosigner who is providing the guarantee of the business loan for small businesses has to fill this form.
● If a trust owns the business, then any trustor has to submit this form.
● If the business has hired a specific person to carry out and maintain the daily activities of the business, they have to complete it.
● In the case of a partnership, all the general partners and the limited partners with more than 20% stake are responsible for the completion of this form. In the case of LLPs, all the partners with a 20% or more stake have to be a part of the same process.
● In the case of a corporate company, all the officers and directors have to complete it along with any owner who has a 20% or more stake in the company.
However, if one is looking to avail of the most popular loans like SBA and SBA 504, it is mandatory to complete this form.
Information on SBA Form 912
Even though it is an important form, it is short and does not take much of the applicant’s time. It will start with the individual’s personal details and the information of the lender of the small business loan. The main thing that will be asked will be the criminal history.
● They will have to specify if they have any prior criminal charges against them and if they are being carried out right now.
● It has to be brought to their notice if they have been to jail for any criminal offense committed in the past six months.
● They should be aware of whether the applicant has been convicted in the past, is out on parole, or if they have pleaded guilty to any offense.
The Right Way to Fill SBA Form 912
Even if one thinks that this might have an effect on the approval of their business loan, they must give only correct information. All the information that one puts on their form can be verified later on. If they give wrong information about their previous criminal records, they may face criminal charges according to Form 912.
The questions will be straightforward, and if their answer is ‘yes,’ the applicant has to provide certain other information. This information would be about the date, location, fines, sentences, documentation at the court, and other information related to the court and the case.
After the submission of this form with the business loan application, one might have to go through a background check. However, keep in mind that the application will be rejected if an individual is currently on parole or probation. This is because the SBA does not give out loans to such individuals.
Documents Required for SBA Loans
The first and foremost document required for the business loan application would be a personal background statement. It will include personal information (current and prior), criminal record, and educational background. Along with that, one has to submit their personal resume, like they do in the case of job applications.
Apart from these two things, the applicant has to show their credit score, personal and business. Other things included would be their personal tax returns, a business plan, legal documents of the business, and its financial statements. If they are pledging collateral, documents related to it and their debt-to-income ratio showing the debt they already owe are also significant.
The Bottom Line
Even if someone has a criminal history, they should not hesitate to submit a business loan application. There is still a chance that their loan will be approved. However, SBA Form 912 might reduce the chances of the loan getting approved.
As a business owner, the SBA requires individuals to have character and a good credit standing. These two would help them win over their trust and get the loan sanctioned by them. If an individual has submitted the form with a criminal history, they have to be prepared for a background check.