Required Documents for Finance or bond application

One of the questions that we have found many individuals and businesses ask accountants when it comes to loan applications is: What documents do I require to apply for finance? We are going to break it down for you as well as give you some tips you probably didn’t know about.

Depending on whether a person is applying as an individual or a business, the requirements are quite different.

Applying as an individual who is employed by a company:

1. Latest 3 Months Payslip
2. Latest 3 Months Bank Statement
3. Proof of Identity
4. Proof of address

The documents above are standard documents and are no guarantee that you would get a loan as the success of your loan application largely depends on your credit score, loan amount required vs income earned and amount of current debts vs current income and expenses. Also, if you are married in community of property, your spouse financial situation or concern might be required.

Worth noting also is the fact that sometimes the bank might grant you a loan without requesting the standard documents if you conduct or manage your accounts or loans well and have a good credit score.

Applying as a Self-employed Person in your personal capacity:

1. Payslip (Up to 6 months’ Worth of Payslip can be required) to proof that you have been paying yourself a salary.
2. An accountant’s letter as proof of earnings.
3. Personal Bank statement (Up to 6 months bank statement can be required)
4. ITA34
5. Proof of Identity
6. Proof of address
7. Latest financial statements
8. Latest management accounts (Usually if your operations have been 6 months and old after the latest financial year end)

Again, the above are standard documents and some banks might not require all of them but don’t forget that your credit score still matters.

Applying in the name of the Business

1. Financial statements. Depending on the type of loan or finance you are looking at, the bank might require you to provide financial statements for a varied period. For example, if you are looking for an overdraft, the bank might require you just 1-year worth of financials but if you are applying for a commercial building, the bank could require you to provide 3 years’ worth of financials.
2. Business Bank Statement.
3. Proof of address of the business
4. Proof of Identity of all Directors
5. Management Accounts

It is worth noting that when a financial institution considers giving a loan in the name of a company, it considers the directors’ personal credit score in some instances. It also considers the amount of positive balance in the account every month to determine affordability and lastly it considers the company turnover per 12 months period. Therefore, it is important that businesses deposit cash received by customers into their business accounts.