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SBA 7(a) Paperwork Explained: Form 1919
Form 1919 gives the SBA crucial information about you, the borrower, and also facilitates a background check. Once you fill it out, you’ll submit it to your participating lender (not to the SBA itself). You must answer each of its 22 questions, and the SBA may review your answers.
The SBA form 1919 is the SBA’s borrower information form, and it’s one of the core pieces of documentation you have to fill out when you’re applying for an SBA loan.
You can download Form 1919 from the Small Business Administration's website.
What Is SBA Form 1919?
This form gives the SBA crucial information about you, the borrower, and also facilitates a background check. Once you fill it out, you’ll submit it to your participating lender (not to the SBA itself).
You must answer every question on the form, and the SBA may review your answers. The form includes 22 questions. You should answer carefully and thoroughly to avoid delays in your application processing.
Who Should Complete Form 1919?
Sole proprietors. If you are a sole proprietor, you should complete the form yourself.
Partnerships. If you are a partnership, everyone who has at least 20% equity in the company should complete the form.
Corporations. In a corporation, all partners with at least 20% equity in the company, plus each officer and director should complete the form.
LLCs. For an LLC, all partners with at least 20% equity in the company, plus each officer, director, and managing member should complete the form.
Managers. Any person hired by the business to manage day-to-day operations should complete the form.
Guarantors or cosigners. If the SBA is asking someone else to guarantee the loan in your case, that person should also complete the form.
Getting Help to Fill Out the SBA Form 1919
You are allowed to use a packager, broker, accountant, lawyer, or other professional outside of your business to help you fill out the form, but if you do, you’ll need to disclose this fact and fill out SBA Form 159.
Top FAQs about the SBA Form 1919
What personal information do I need to disclose?
You’re required to write the legal name of your business as it appeared on your last tax return. Form 1919 defines the “applicant” as the name of the business, but each person filling out the form on behalf of the business is required to disclose identifying information like name, social security number, date of birth, place of birth, and citizenship status.
What if I’m not a US citizen?
If you’re not a US citizen, you can still qualify for an SBA loan. You’ll need to provide your Alien Registration Number, and you may need to meet additional requirements, like having real estate in the United States, or a management or advisory team made up of US citizens.
The form also contains questions about military status, gender, race, and ethnicity, but these questions are voluntary and don’t have any bearing on the SBA’s credit decision.
What questions will I be asked about my business?
You’ll be asked some basic information about your business, such as how many employees you have. You should include full- and part-time employees, but you do not have to include independent contractors in this number. You’ll also need to calculate how many jobs you’ll create – or how many jobs you’ll be able to retain that would otherwise have been lost (if any) – as a result of the money you get with the loan.
Will I be asked about my criminal history?
The SBA form 1919 does ask about criminal history. This includes questions about whether you’ve been debarred by any Federal department or agency, and whether you’re delinquent in paying child support. All parole and probations must be lifted before you’re eligible for an SBA loan.
If you are subject to any criminal charges right now, you won’t be able to get an SBA loan. If you have had past criminal convictions (other than minor vehicle violations), you may still be eligible for the loan, but will need to fill out SBA form 912 and furnish additional details about the circumstances surrounding your conviction. You’ll need to disclose any and all convictions, no matter how long ago they took place.
What qualifies as a business affiliate?
Form 1919 asks several questions about “business affiliates.” According to the SBA, a business affiliate includes:
Parent companies
Companies that are owned or controlled by any of the applicants
Companies that any of the applicants own at least 20% of
Companies that any of the applicants own unexercised options of at least 50% stock
Companies that have entered into formal agreements to merge with the business applying for the SBA loan.
When the applicant (or anyone with more than 10% equity in the company applying for the loan) lives in the same household as an SBA employee – current or former.
When the applicant is closely connected to members of congress, officials of the legislative or judicial branch, and government employees with a grade of GS-13 or higher.
What documents are required to apply for an SBA 7(a) loan?
To apply for an SBA 7(a) loan, you will need to provide the following documents:
- SBA Form 1919 (borrower information form)
- SBA Form 912 (statement of personal history)
- SBA Form 413 (personal financial statement)
- Financial statements, including a balance sheet, profit and loss, and income projection
- Agreement to purchase the business
- Letter of intent to buy the business
- Business tax returns for the past three years
- Any outstanding business debt
- Long-term business contracts
- Documentation of business assets
- Business lease agreement
- Incorporation documents and/or business license
- Business plan
In addition, the SBA will usually order an independent business appraisal to give lenders an idea of what the true value of the business is.
The SBA allows applicants to get help (for example, from a lawyer or a translator) filling out the application paperwork, but your lender will be required to submit information about who gave you help to the SBA, so you’ll need to document who this person is as well.
What is the purpose of Form 1919?
The purpose of SBA Form 1919 is to provide the SBA with crucial information about the borrower and facilitate a background check. It includes 22 questions that must be answered carefully and thoroughly to avoid delays in the application processing. Questions include personal information such as legal name of the business, name, social security number, date of birth, place of birth, and citizenship status. It also includes questions about military status, gender, race, and ethnicity, but these questions are voluntary and don’t have any bearing on the SBA’s credit decision. Additionally, questions about business affiliates, exporting goods, and criminal history are included.
Sources:
www.sba7a.loans/sba-7a-loans-small-business-blog/what-is-the-sba-form-1919How long does it take to complete the SBA 7(a) loan paperwork?
The SBA 7(a) loan paperwork can take anywhere from 7-10 business days to process if you are using the Standard 7(a) Loan Processing model. This is used by lenders who will only see an SBA 7(a) loan application occasionally. The SBA reviews the package and will usually confirm the lender’s decision about whether to approve the loan.
If you are using the Certified Lenders Program (CLP) Processing model, the process is much shorter and only takes three business days. Certified lenders have experience dealing with borrowers under SBA loan programs and have met specific performance standards. The SBA is able to expedite application approvals for borrowers dealing with these lenders.
Sources:
What information is needed to complete Form 1919?
Form 1919 requires you to provide the legal name of your business as it appeared on your last tax return. You will also need to provide identifying information such as name, social security number, date of birth, place of birth, and citizenship status. If you are not a US citizen, you will need to provide your Alien Registration Number and may need to meet additional requirements such as having real estate in the United States or a management or advisory team made up of US citizens.
The form also contains questions about military status, gender, race, and ethnicity, but these questions are voluntary and don’t have any bearing on the SBA’s credit decision.
You will also be asked some basic information about your business, such as how many employees you have. You should include full- and part-time employees, but you do not have to include independent contractors in this number. You’ll also need to calculate how many jobs you’ll create – or how many jobs you’ll be able to retain that would otherwise have been lost (if any) – as a result of the money you get with the loan.
The SBA form 1919 does ask about criminal history. This includes questions about whether you’ve been debarred by any Federal department or agency, and whether you’re delinquent in paying child support. All parole and probations must be lifted before you’re eligible for an SBA loan. If you are subject to any criminal charges right now, you won’t be able to get an SBA loan. If you have had past criminal convictions (other than minor vehicle violations), you may still be eligible for the loan, but will need to fill out SBA form 912 and furnish additional details about the circumstances surrounding your conviction. You’ll need to disclose any and all convictions, no matter how long ago they took place.
Form 1919 also asks several questions about “business affiliates.” According to the SBA, a business affiliate includes:
- Parent companies
- Companies that are owned or controlled by any of the applicants
- Companies that any of the applicants own at least 20% of
- Companies that any of the applicants own unexercised options of at least 50% stock
- Companies that have entered into formal agreements to merge with the business applying for the SBA loan.
You will also need to specify on the form that your business does export goods. You will also need to disclose on the form if you plan to begin exporting goods or services. If you will use any part of the money you get from the SBA loan to help with exportation, you will need to calculate the amount.
What are the benefits of an SBA 7(a) loan?
The SBA 7(a) loan program offers several benefits to small businesses, including:
- Flexibility in underwriting
- Often has lower interest rates than other comparable financing options
- Long loan terms, up to 25 years for real estate, 10 years for equipment, and 10 years for working capital or inventory
- Flexible collateral requirements
- Lenders are prohibited from charging certain fees, including:
- Insurance service fees
- Add-on interest charges
- Legal service fees (with some exceptions)
- Broker referral fees
In addition, SBA 7(a) loans can be used for various business purposes, including renovations, capital purchase, seasonal lines of credit, or refinancing of existing debt. There is no prepayment penalty for loans that mature within 15 years, and no balloon payment.
What if my business exports goods?
You will need to specify on the form that your business does export goods. You will also need to disclose on the form if you plan to begin exporting goods or services. If you will use any part of the money you get from the SBA loan to help with exportation, you will need to calculate the dollar amount you plan to spend on exporting goods or services and specify that amount on the form. There is no definite procedure to follow to calculate this number, so you’ll need to provide your best estimation.
What if my business is a franchise?
You can still get an SBA loan if your business is a franchise, but you’ll need to disclose that your business is a franchise on the form. The SBA considers two kinds of franchises: product/trade name franchising (when the franchiser owns the name, and the franchisee buys it – i.e., many gas stations) and business format franchising (where the franchisor provides a full range of services, i.e. McDonald’s).
Are there business types that are ineligible for an SBA loan?
Yes. Question 16 on Form 1919 requires you to disclose whether your business generates revenue as a result of gambling or overtly sexual activities or displays. These types of businesses won’t be approved for an SBA loan.
What about my other loans?
If you, or anyone else filling out the form, has ever obtained a guaranteed loan by any Federal agency (including the SBA) – for example, a Federal student loan, FHA loan, or Federal disaster loan – or have been the guarantor of one of those loans, you’ll need to disclose that on Form 1919. In addition, you’ll specify whether any of the payments on these loans are delinquent, or if you’ve ever defaulted on one of these Federal loans.
If you have ever applied for an SBA loan before, you’ll need to disclose that on the form. If you’re prohibited from applying for this SBA loan, your application may not be submitted via the 7(a) Express Loan program. However, your lender may still process your application using the standard 7(a) procedure if this applies to you.
What is the Community Advantage Program?
The Community Advantage 7(a) Program is an SBA program catering to underserved communities. They generally award up to $250,000 and have an expediated application process. If you’re applying for the loan under this program, you’ll need to disclose that on Form 1919 and fill out SBA Form 2929.
Do I need to disclose how I’ll use the loan money?
Yes. Form 1919 includes questions about how your business will use the money obtained from the SBA loan. If, for example, you plan to use more than $10,000 for construction, you’ll need to disclose that, as well as fill out SBA Form 601 to provide more information about the construction.
What about a potential for conflict of interest?
The SBA will not provide loans to applicants where a conflict of interest, or the appearance of a conflict of interest, exists. Form 1919 asks a series of true/false questions to determine whether there is a conflict of interest. Answering “false” to any of these questions doesn’t necessarily mean you won’t qualify for the loan, but it will require different processing procedures.
Situations that constitute a conflict of interest include:
What am I signing at the end of the form?
The last page of the form contains legal and binding language, certifying that you know the terms of the loan you’re applying for and that you’ve truthfully answered every question on the form. Once you’ve read the page, sign your name, print your name clearly, and write the date.
Form 1919 and Your Application: Putting it All Together
Don’t miss any details when you’re putting together your paperwork for your SBA 7(a) loan application. Use our tool, the "SBA Loan Checklist: Getting Ready to Apply" to keep track of your progress.
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