Complete Guide to SBA 1919 Form Section I for Assisted Living
Dec 20, 2024
Filling out forms can be tricky, especially when it comes to getting a loan for your assisted living business. The SBA 1919 form is one of those important forms, and it’s a big step in getting the funds you need. But don’t worry, I’m here to help!
In this guide, we’re focusing on Section I of the SBA 1919 form. This section is all about your business. We’ll walk you through what to fill out, what to watch out for, and some tips to make it easier. If you’re looking to start an assisted living business, this guide is for you!
Check out the video, too:
What Is the SBA 1919 Form?
The SBA 1919 form is a must-have if you want to get a loan from the Small Business Administration (SBA). It’s a way for the SBA to get to know your business and see if it’s a good fit for a loan.
- Section I is all about your business—things like your address, what you do, and who owns it.
- Section II (which we’ll talk about in another guide) is about the owners.
Filling out the form correctly is super important because it helps the SBA trust that your business is solid and ready for funding.
Understanding Section I: Business Information
Business Identification
First, you’ll need to decide if your business is an Operating Company (OC) or an Eligible Passive Company (EPC):
- OC: This is the company that runs the day-to-day operations, like taking care of residents in your assisted living facility.
- EPC: This is the company that owns the property and leases it to the OC.
For example, if your business owns the building and runs the assisted living services, you might have to fill out parts for both the EPC and OC.
Business Details
Now, you need to fill in some basic information:
- Business Address: This could be your home address or even your lawyer’s office if that’s where your business is registered.
- Tax ID: Enter your EIN (Employer Identification Number) or SSN (Social Security Number) for sole proprietors.
- Phone Number: This can be your phone number when you’re just starting.
- Project Address: This is the address where your assisted living facility will be.
Loan Request Details
This part is about the money:
- Write down how much you’re asking for.
- Explain what you need it for—like buying the property, doing renovations, or buying equipment.
- Show how many jobs your business will create or keep. This part is really important because the SBA loves to support businesses that create jobs!
Ownership and Legal Stuff
Ownership Structure
You’ll need to list each owner’s:
- Full name
- Title (like CEO or Owner)
- Percent they own in the business
- EIN or SSN
If anyone owns 20% or more, they’ll need to fill out Section II.
Legal and Financial History
Answer the yes/no questions about your business’s history, like:
- Have you or your business ever filed for bankruptcy?
- Do you have any legal troubles?
- Do you have other businesses that are tied to this one?
If you answer "yes" to any of these, be ready to give more info and paperwork.
Key Considerations for Assisted Living Businesses
- Job Creation: How many new jobs will you create, like caregivers or office staff?
- Affiliates: If you own other businesses or properties, you’ll need to list them.
- Compliance: Make sure you follow all the local rules and have the right licenses for your assisted living business.
Common Challenges and Tips
1. Incomplete Financial Records
Lenders want to see your business’s financial health, so make sure you have:
- Profit and loss statements
- Balance sheets
- Tax returns from the past few years
Using tools like QuickBooks can make this easier.
2. Confusing Terms
The form uses some big words, like "affiliates" and "EPC." If you’re unsure what they mean, don’t guess—ask your lender or a financial advisor for help!
3. Extra Paperwork
Depending on your business type, you might need extra documents. This could be:
- Franchise agreements
- Management contracts
Final Steps Before You Submit
Before you send in your SBA 1919 form:
- Check for Mistakes: Make sure everything is filled out correctly.
- Add Supporting Documents: Include any extra paperwork the SBA asks for.
- Ask Your Lender: If you’re not sure about something, ask your SBA lender. They’re there to help!
Wrap-Up
Filling out Section I of the SBA 1919 form might seem complicated, but if you take it step-by-step, you’ll get through it. This part is all about showing the SBA that your assisted living business is a smart and safe investment. By paying attention to the details, you’ll be one step closer to getting the funding you need to make your business dream a reality.
Next Step?
If you need help creating a business plan for your assisted living business, download our Business Plan Checklist to ensure you have a solid business plan to help launch your assisted living business.
Need help figuring out where to start? Join the next Roadmap Challenge and build your launch plan with me.
Show full transcript 👇
Transcript
00:00:00
a big part of an sba application is the 1919 form it's a really standard form but it can feel a bit daunting when you look at it all and just try to figure it all out in today's video we're going to get into a review of how to fill out section 1 of the sba 1919 form hey everybody i'm brandon gustafson and i own and operate two assisted livings and i created this channel to help people just like you learn the ins and outs of investing in assisted living welcome to assisted living investing
00:00:30
[Music] hey welcome back to the channel in our last video we talked about the personal finance statement and gave you a tutorial of what it is and how you use that pfs for sba loans i hope that was a helpful tool for you today we're going to get into the 1919 form which is another form that you need as you were going through the process to get your sba loan um there are a few different sections so this video we're going to be talking about section one specifically and i'll be giving you a
00:01:07
full tutorial of what that form is and how it works and how you can kind of fill it out a lot of it's self-explanatory but i want to make sure that you kind of have a a good way to walk through it as you're looking at it because some of the things just might be a little off and i just want to make sure it's clear for you before we get into the tutorial though i want to just give you an overview of what the 1919 form is this is a standard sba form that gives the sba a high level overview of the
00:01:35
company that will be receiving the funds and the individuals involved in the business so there are two main sections with this section one which is what we'll be getting into today is the borrower information this is the business that you're doing uh that's getting the funds section two is going to be the individual owner information so this is done at an individual level so if you have multiple owners in a business you're going to have to do a section 2 1919 form for each individual
00:02:07
owner that has i think 20 ownership in the business at least 20 percent once you've filled out this form the sba is going to use the form to make sure that there are no outstanding legal issues for any of the owners of the company or the company itself the form also gathers some high level information on the amount of money being requested and how many jobs it's going to create and we'll get into that as we go through the tutorial let's jump into the tutorial here of the 1919 form so what
00:02:34
i'm showing you here is a complete view of the form so this is all one big long document sections one and two in here along with this cover page on here i'm going to skip over the cover page when you get the form i would suggest that you read it make sure that you are comfortable with it but i talked a little bit about 20 ownership and this is where it talks to you about 20 ownership and why um that person needs it it also is going to tell you a little bit about a epc an eligible passive company and an
00:03:08
oc and operating company so an operating company is a an entity that is going to go in and i'm going to link above my video on how i have set up my entities but an operating entity operating company is the company that you know if you're in assisted living that is actually doing the assisted living operating that company the eligible passive company is generally going to be something like a real estate entity so in our structure in the video that i've linked up above is you know our real estate entity is the
00:03:43
epc and then the entity that is running the assisted living facility is the oc so we actually had to do this twice for each of our entities when we're going through the sba portion of it so make sure you read through this information here it's going to be really helpful for you and just understanding what you are filling out and gives you some of these different terms and things like that it's going to give you a lot of good information down here is section one so right here you would indicate if you are an oc or
00:04:13
an epc and then the name of the business the the legal name and then this is the operating business legal name so if you're filling this out for the epc you would put the legal name of that entity that owns the real estate and you would also put in the operating business legal name that is going to be operating inside of it if you're doing just the oc on here you would fill out the name here and here and then you would indicate oc um is the applicant a cooperative an esop a 401k plan a trust or other
00:04:48
so whatever is applicable to you you would put in here if you if this is not applicable to you then you would just put n a right there do you plan to use 401k plan including a rollover for a business startup or a rob's plan for equity that's robs is a rollover for business startup it's a certain plan that you can do i'm not super familiar with this i'm not going to get into it but if you did an internet search for it you could there's a lot of resources out there for rob's plans so you just indicate yes or
00:05:20
no next is will a management company be hired by the applicant to manage the day-to-day operations so are you going to be doing this yourself if if so you would click no if you're hiring it out to somebody then you would click yes and then you do need to provide a copy of that management agreement when you send this into the sba this is the primary business address so this is where the business is headquartered you're going to put that in there your tax id information on here primary business phone number um so in
00:05:52
the beginning especially when you're filling this out you might not have all of this stuff and it's okay to just put your personal information in there so you know primary business phone was my phone number for example primary business addresses is where you know the address that you are using when you're filing your taxes um is what it is so it could be your personal address if you're using an attorney that is your registered agent um you could be using that address as well for that so just kind of depends on what
00:06:21
it is the project address is where the actual facility is going to go or where you're doing your business the primary contact name is likely going to be you if you're the one that's being uh tasked with filling all this out and you found me on youtube and you're working on building this out you are probably the primary contact um for getting this form filled out so put in your name your email address your business phone number there as well this is a section where you're going to
00:06:52
get into an amount of loan requests so you know you're putting in a high level in here what this is and then this section right here is going to let you put in some of the different really high level purposes of the uh of the request for the funds but you can see here if financial statements provided to the lender do not include a schedule of business that provide on a separate attachment so that's where if you've built out a pro forma this is typically what i will do i'll i'll try
00:07:26
to put things in really big buckets to fill out these six areas that it gives you um but then i make sure that when i'm communicating to the sba lender that i'm telling them i've given you a pro forma that really breaks this stuff down for what i need and then this is the amount of money that i need on the request this is information that the sba uses to see you know how many bus how many jobs are being created by your small business which is something that's really important for the sba
00:07:54
that you need to do so number of existing employees employed by the business if you're buying something that exists already with your sba loan you're going to put in there how many jobs have already existed with it and this could also be owners it could be that this is a new business or you don't plan on keeping anybody there so you would just put zero on that this is number of jobs created as a result of of the loan and so this would be how many jobs you think you're going to be creating and this is how many jobs
00:08:22
will be retained that otherwise would have been lost by doing the sba loan this is the ownership information of the applicant and remember section one is the business information up here so the applicant when it talks about applicant in section one is the business so these are the owners of the business you're gonna put in here the owner's legal name their title how much of the business they own their tax id number whether that's a social security number or an ein and if you'll remember from my the way
00:08:57
that i structure things i have an entity that owns my stake in my different businesses is the way that i do it so i have you know my entities name here um and we call it just owner manager whatever title i need it to be 50 owned and it's it's ein number right there is what goes into it and then the address that i have for it and then if it is one of these esops 401k are a cooperative i would just indicate that here it's the same question that's being asked up here as well it gives you a little bit of a breakdown
00:09:30
about what those things are down here below that this section right here um we're on page three now of of the 1919 form is a bunch of kind of yes no types of questions and they're pretty straightforward i'm not gonna get into it and read through every single one of these but it's something that you want to be aware of as you are filling this out you need to make sure that you answer every single question that is put in there for you i'm going to try to go through and and identify a few of these though that
00:10:07
might be questions that you have so a co-applicant uh this means that do you have two businesses that are applying um for example do you have a real estate entity and an operating entity you would be putting that information in here and you can see here i mentioned this earlier please complete a separate section one for each of those businesses that are on there so that's what you would do for them have you submitted a loan request for this entity before um you know if you've already submitted a
00:10:44
request you've tried to get funding for this already or you already have funding for this business as you click yes here otherwise you would put in no so an affiliate right here has the applicant and or its affiliates an affiliate is you know you've got um when we did our idaho property for example uh we had to mark that yes we had a we had a separate entity we had a separate affiliate um that had received had received sba funds but then these next two sections you know we are not delinquent and we are not in default so
00:11:21
we'd click no on those ones so pretty simple to give that information if you are marking that yes you have an affiliate then it's the bank is going to reach out to you and ask for the paperwork of those businesses they're also going to want to see financials and so just make sure that as you're getting into this process that you have a lot of this information put together they're going to want to see previous years tax returns they're going to want to see the most recent year's p l and balance
00:11:52
sheet p l profit and loss statement um and they're going to want to see like up to the most recent month um in the current year as well they want to see like year-to-date financials as well so as you're going through this process you want to make sure that you have those things put together if you're using a system like quickbooks generally it's pretty easy to put those those types of things together are you suspended from any agency yes or no do you operate a franchise so if you're
00:12:22
a franchise then yes you needed you would mark yes and then you need to provide a copy of the franchise disclosure document or the fdd the franchise that you're working with is going to have the information that sba is going to need for this but it's something that if you want to make sure that you are aware of if if you're getting into this as a franchise world there's going to be some extra paperwork and a few other things that you need to make sure you're passing that along
00:12:50
to um you know to the sba so this section right here is talking about affiliates again if you read this cfr so cfrs are i can't remember what cfr stands for but they are um federal regulations basically if you are wondering what an affiliate is you can click on that cfr link there or or just do an internet search for that cfr it's going to take you through and you're going to be able to find information on that cfr and what an affiliate is and then this is you know have you or any affiliates ever filed for bankruptcy
00:13:23
um and then are you or your affiliates in any legal action so yes or no questions there pretty simple if you're exporting anything you're gonna have to put that information in here um and where you're exporting it how much you're exporting so this is around exports if you're doing assisted living you're not doing exports but it's something that you know you just click no there if you are doing exports then you need to get this information i would probably suggest reaching out to your
00:13:47
lender for guidance on how they want this filled out it's not something that i have ever done but it's something that you want to make sure that you're filling out correctly have you paid anybody to help you fill out this loan application yes or no and are you getting any money from gambling or loan packaging or anything like that if you are then you need to provide the details in a separate sheet number number 13 is is anybody involved with the business have they recently worked with the sba number 14 is anybody
00:14:23
with 10 percent or more interest are they an elected official a member of congress or appointed official anything like that uh anybody that's an owner that's 10 owner or more part of the military and then this number 16 is anybody that owns 10 or more of the business are they a part of the sba the small business advisory council or a score volunteer so this is really this is i think is there a conflict of interest here and do we just to cover our backs and if yes then we need to get a little more
00:14:57
information into what that situation is so you want to make sure that you're following that and i'll correct myself on the military portion of it they need to have a grade of at least a gs 13 or higher it's not just anybody that's in general active duty or anything like that it needs to be at a certain level and then number five right here this is just the part where you are signing it as a representative of your business remember applicant is the business on here so if you are the authorized
00:15:28
representative you're going to sign it here you're going to print your name and then do your date and the title and that's it that is section one um as long as it took me to go through this in the tutorial is probably about how long it's going to take you to fill out it's not a lot of hard information you can see but there's some questions in there and a few things that i'm sure you're i don't know what an affiliate is or how do i learn what this is what's a
00:15:51
epc or a an oc what's the difference between those and so i hope that was really helpful for you i hope you liked the tutorial if you did make sure you smash that like button and subscribe to the channel so that you can get more informative compound content like this to help you through the process of getting your own assisted living facility or starting your own small business in our next video we're going to be getting into section 2 of the 1919 forum so make sure you watch that video i was going to put
00:16:20
it all together but it felt like a lot to put together so we're going to make a separate video for it if you are interested in learning more about investing in assisted living make sure you visit me on assistedlivinginvesting.net i have free resources over there and you can also set up a call with me and we can chat through the process as you're trying to get up and running in your facility and remember it doesn't take a lot just a little bit just keep making progress step by step by step if you are
00:16:44
consistent i promise you that you will be successful thanks for watching and have a great day [Music]
Download Your FREE Calculator
Stay connected with news and updates!
Join our mailing list to receive the latest news and updates from our team.
Don't worry, your information will not be shared.
We hate SPAM. We will never sell your information, for any reason.