Use your first lender conversation to collect answers you can compare later. Bring your funding amount, intended use, timing and current debt payments. Take notes under the same questions for every provider, and request written confirmation before committing.
This checklist is for the conversation itself. If you have not narrowed your search, start with how to choose a business lender.
Who am I dealing with?
Ask: “Which legal company will provide the funds, and who will service the agreement?” Record both names. If the person is an intermediary, ask who receives your application, whether it will go to multiple providers and how the intermediary is paid.
Then ask: “Is this a loan, a line of credit or a purchase of future revenue?” Do not rely on the word “funding” to explain your obligations. Our Fora Financial profile separates its loan and revenue advance so you can see the questions different structures raise.
Is my business eligible for this exact program?
Ask which location, industry, revenue, credit and operating-history requirements apply. Mention existing financing and any unusual ownership or revenue circumstances early. Ask whether the intended use is permitted and what additional underwriting remains after meeting the published minimums.
Also ask: “Which documents do you need, and when could you make a decision after receiving a complete file?” Distinguish an estimated decision date from the date usable funds could reach your account. The SBA's Lender Match checklist is a useful preparation reference for the amount, use of funds and financial information lenders may discuss.
What will I receive and repay?
Request the gross financing amount, every deduction and the net deposit. Ask for all fees, including charges triggered by drawing funds, maintaining an account, paying late or returning a payment.
Ask: “What is the total repayment, and what assumptions could change it?” Where available, request APR as well as the dollar cost. A factor rate is not an annual interest rate. Fora's explanation of factor rates and APR describes why repayment timing matters when comparing different pricing methods.
For revolving credit, ask whether the quoted cost assumes one draw or repeated borrowing. The Fundbox profile offers an example of why the specific product and application channel matter when reviewing terms.
When and how are payments collected?
Ask for the exact payment amount, frequency, first due date and collection method. Put those dates beside payroll and other major expenses. Ask whether rates or payments can change during the agreement.
For payments tied to revenue, ask: “How do you calculate revenue, how often do you adjust collections, and what evidence must I supply?” Request a worked example using a slower month. Keep it with the offer rather than relying on a general assurance that payments are flexible.
What obligations continue if things change?
Ask what assets secure the financing, whether there is a personal guarantee and what events trigger default. Confirm when any personal or business credit inquiry occurs. Ask how to contact servicing if a payment problem arises.
Request an early-payoff example for a specific date. Ask whether paying early reduces remaining interest or fees, creates a penalty, or requires a special discount. Review the relevant clauses with your accountant or adviser if you cannot explain them in your own words.
What should I have before deciding?
Leave with a written offer, the proposed agreement, the provider's identity and a list of unresolved questions. The FTC warns that paying an advance fee cannot guarantee approval. Check unexpected payment requests independently before acting.
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