Before an offer, a lender can ask a Benton, AR business to show how long it has operated, what revenue reaches its bank account each month, the owner's credit and the debt it already pays. Tax returns, recent statements and a debt schedule back that up. Buying an existing business adds the seller's records; equipment loans lean on the machine, credit lines on cash flow.
The first screens, deposits less own transfers, a debt schedule with coverage before and after a loan, purchase records and equipment versus line reviews.
Time in business, revenue and credit: the first screens
Three checks come first. Time in business is read from formation papers and the first deposits. Revenue is read from deposits, not from what the owner estimates. Credit covers the owner and, where it exists, the business file. Each partner sets its own minimums, so the useful step is to know your own figures before you ask.
A large part of the county runs without payroll. In 2024, 10,451 Saline County businesses had no paid employees at all, by the count in Nonemployer Statistics. Separately, the American Community Survey puts self-employed residents at 9.4% of employed county residents (2020-2024, margin of error 1.1 points). For a sole proprietor, the Schedule C on the personal return is the business tax record a partner reads.
Illustration only, invented figures: six months of deposits for a small contractor, with transfers between the owner's own accounts taken out:
| Month | Deposits | Own transfers | Revenue deposits |
|---|---|---|---|
| May | $61,840 | $4,200 | $57,640 |
| June | $58,310 | none | $58,310 |
| July | $66,925 | $6,500 | $60,425 |
| August | $63,480 | none | $63,480 |
| September | $59,770 | $3,000 | $56,770 |
| October | $64,315 | none | $64,315 |
Counting every deposit gives $62,440.00 a month. Taking out the transfers gives $60,156.67, the figure a partner would use. Marking those transfers before sending statements saves a round of questions.
Statements, returns and a debt schedule in Benton, AR
Statements and returns show income; the debt schedule shows what is already promised out of it. A short one for an invented Benton, AR company:
| Debt | Monthly payment |
|---|---|
| Service truck loan | $912.44 |
| Equipment loan | $1,386.20 |
| Credit line minimum | $450.00 |
| Total | $2,748.64 |
A complete schedule lists more than the payment: the lender or lessor, the balance today, the date of the last payment and what secures each debt. Include equipment leases, merchant cash advances and business credit cards, even small ones. A debt that turns up in the bank statements but not on the schedule raises a question that slows the review.
A partner can compare yearly operating income before debt payments with yearly debt payments, a ratio called debt service coverage. With $148,000 of income and $32,983.68 of existing payments a year, the ratio is 4.49. Put a $85,000 loan on top, five years at an annual rate of 11%, and yearly payments grow by $22,177.32 ($1,848.11 each month), pulling the ratio down to 2.68. Each partner sets its own minimum; knowing the after-loan number before asking tells the owner how much room there is. The funding types page lists which products a partner reviews this way.
Extra steps when the loan buys an existing business
Buying a business means a partner reviews two companies: the one being bought and the buyer's ability to run it. On top of the buyer's own records, expect requests for:
- The seller's last three years of business returns and this year's profit and loss
- The purchase agreement or signed letter of intent, showing how much of the price is goodwill, equipment and shelf stock
- The landlord's consent to transfer the lease, or a new lease in the buyer's name
- A list of the equipment changing hands, with serial numbers
- The buyer's resume, showing experience in the same trade
Illustration only, invented figures: a $360,000 purchase, with $36,000 from the buyer, a $54,000 note held by the seller and a $270,000 loan. The seller note at an annual rate of 6% over 60 months runs $1,043.97 a month, a payment that belongs on the debt schedule next to the loan. A term loan fits the loan part of a purchase, with a fixed payment over years.
How requirements differ between equipment loans and credit lines
The machine carries much of the weight in equipment financing: a partner wants the quote or invoice, the serial number or VIN, and for a used unit its hours and condition. Because the equipment secures the payment, a shorter history can sometimes be weighed against a well-valued machine.
A business line of credit has no single item behind it, so cash flow carries the review. A partner can ask for more months of statements, a receivables aging report if customers pay on terms, and a review again at renewal. A line request that shows how draws would be repaid, job by job or payroll by payroll, answers the main question up front.
For either product, the request form is a starting point rather than a credit application, and the funding partner decides whether to look at credit while it reviews the file. The Flintgate articles page lists the other five posts in this series.
By Flintgate Capital Group · Updated
