The purpose of SBA Form 413 is to provide the Small Business Administration (SBA) with personal financial information to analyze the repayment ability and credit worthiness of an application for an SBA guaranteed 7(a) or 504 loan or a guaranteed surety. This form requires the applicant to list out their personal information, financial assets, liabilities, sources of income, contingent liabilities, and more. You can download this form here.

SBA Form 413 is required when applying for both SBA 504 and SBA 7(a) loans, and is a personal financial statement. On this form, you will list out your personal information, your financial assets (cash, savings, vehicles, and more), as well as your liabilities, such as accounts payable, additional notes payable, real estate mortgages, and the like. You will also list sources of income, contingent liabilities, and more. This document also contains important information about your rights to privacy and the freedom of information.

You can download this form here. The information required to complete SBA Form 413 includes:

• Personal information
• Financial assets (cash, savings, vehicles, etc.)
• Liabilities (accounts payable, additional notes payable, real estate mortgages, etc.)
• Sources of income
• Contingent liabilities

SBA Form 413 is required when applying for both SBA 504 and SBA 7(a) loans, and is a personal financial statement. According to the SBA, “The SBA uses the information required by the form 413 as one of a number of data sources in analyzing the repayment ability and credit worthiness of an application for an SBA guaranteed 7(a) or 504 loan or a guaranteed surety.” Section 2 of Form 413 provides space for the applicant to list all notes payable to banks (or any others). For each note, the applicant must list the name and address of the noteholder, original balance, current balance, payment amount, frequency of payments, and how the note is secured or endorsed. If collateral is involved, you should list the type of collateral. The form provides space for five notes, but if you have more, you’ll need to list them (with all pertinent information) on a separate sheet. Each separate sheet should be clearly labeled as part of Section 2 of Form 413 and signed.

The SBA 504 loan program offers several benefits to businesses, including long-term, fixed-rate financing, lower interest rates and down payment requirements than SBA 7(a) loans and Express loans, and the ability to purchase fixed assets such as real estate and equipment. The loan is also backed by the SBA, reducing risk for lenders who put up half the cost of the project. In the case of default, the private lender has first lien on project assets. Terms for SBA 504 financing are typically 10, 15, or 20 years, and the loan is fully amortized without a balloon payment.

Sources:

• What Is an SBA 504 Loan?
• SBA 504 Loans: What You Need to Know

In order to take out an SBA 504 loan, your business must meet the following eligibility requirements:

• Your business must be a for-profit organization.
• Your business must meet current SBA size standards.
• Your business’ net worth cannot exceed $15 million.
• Your business cannot earn 1/3 or more of its income from packaging SBA loans.
• Your business must earn an average of $5 million or less per year (after taxes, and only for the preceding two years).
• Your business cannot be engaged in any sort of passive or speculative activities.

Note that additional requirements may be placed by CDCs or conventional lenders. You can find a full list of eligibility requirements and other important information with the SBA here.