subject: Small Business Grant requirements [print this page] Everyone has to follow certain rules and guidelines to get a small business grant from small business administration. Depending on the specific grant that is required, there will be different criteria for applying. If the government grant is used for something that one has not mentioned, the government will require you to pay back the loan. So, you should clearly show why the grant is needed and how and what the money from government will be used for.
One should go through the right steps while applying for a government grant for your business. A lot of documentation is required for the government grants. When most businesses try to find financial support for their activities, they usually look at traditional methods of getting money. This involves going to the bank and applying for a loan. Most often, banks will need collateral for any loan they granted. This means that to start a business, one has to give his/her house as collateral in case the business fails. By getting a free government cash grant for businesses, you can get free money from the government to help you with your business and you do not have to repay the loan.
The qualifying standards of small business administration grants are more flexible than other types of loans and the lenders usually ask certain information before deciding to grant a small business administration loan program. The documents that are needed to evaluate the loan request are business profile, the request for loan, collateral and personal financial statements. Business profile means the type of business, annual sales, number of employees, and length of time in business and ownership. The request for loan should include purpose, amount, type of loan and how loan funds will be used. Collateral means the description of collateral offered to secure the loan, including equity in the business, borrowed funds and available cash. Personal financial statements mean statements of owners, partners, officers and stockholders owning 20% or more of the business. The complete financial statements for the past three years and current interim financial statements also should be given to maintain the transparency.
The strength and accuracy of your financial statements will be the primary basis for the lending decision. The most important documents in your financial statements should be balance sheets of last three years, income statement for the last three years, cash flow projections and personal financial statements. Cash flow projections must show how much cash is expected to be generated to repay the loan and Personal financial statements should list all personal assets, liabilities and monthly payments, as well as your personal tax returns for the past three years.
The size standards that the U.S. Small Business Administration has established for most industries in the economy for awarding small business loans and small business grants are - 500 employees for most manufacturing and mining industries and 100 employees for all wholesale trade industries. Also, the cash flow should be $6 million for most retail and service industries, $28.5 million for most general & heavy construction industries and $12 million for all special trade contractors
Small Business Grant Source:
Learn the application procedures, various funding sources for specific types of businesses and eligibility criteria for small business grants. You can find the most comprehensive information on availing of small business grants by visiting this online guide on grants
Small Business Grant requirements
By: David Hensley
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