Master SBA Loans: Step-by-Step Personal Finance Statement Guide
Dec 23, 2024
Starting an assisted living facility is exciting, but you need money to get started. Many people use SBA loans to get the money they need. Part of applying for an SBA loan means filling out a Personal Financial Statement (PFS). This form shows the bank what you own and what you owe so they can decide if they’ll lend you money.
Don’t worry if the form seems hard. In this blog, I’ll walk you through it step-by-step. We’ll make it simple, so you can understand what to do and feel good about finishing the form.
Check out the video, too:
What is a Personal Financial Statement (PFS)?
The Personal Financial Statement (PFS) is a form from the Small Business Administration (SBA). It’s not a form you create—SBA gives you the form to fill out. It’s like a big checklist of your money stuff, showing what you own (like a house or car) and what you owe (like loans).
Why Is the PFS Important for Your SBA Loan?
The SBA uses the PFS to see how strong your finances are. They want to know if you can handle a loan and if you have enough assets (things of value you own). Filling out this form right can help you get your loan faster. It shows the lender you’re serious and ready.
Step 1: Understanding the Form
The form is split into two main parts:
- Overview: This part shows your big picture—what you own and what you owe.
- Details: Here, you give more info on each thing you own and each thing you owe.
Step 2: Filling Out Basic Information
Start by adding your basic information:
- Name: Your full name.
- Phone Number: The best number to reach you.
- Address: Where you live.
- Business Info: If you have a business name, write it down too.
- Business Type: If you have an LLC (Limited Liability Company) or other type, choose the right one.
Step 3: Completing the Assets Section
Here’s where you list all the things you own that have value:
- Cash on Hand & Savings: Add up what’s in your checking and savings accounts.
- Retirement Accounts: Write down what’s in your 401(k) or IRA.
- Real Estate: If you own a house, get an estimate of its value (you can use Zillow).
- Vehicles & Personal Items: List your car and anything valuable, like jewelry.
- Life Insurance: Only put down life insurance that has cash value (not term insurance).
- Other Assets: Anything else you own that’s worth money—write it down.
Tip: Double-check your math to make sure everything adds up!
Step 4: Listing Your Liabilities
Now, it’s time to show what you owe:
- Credit Cards: How much do you owe on your credit cards?
- Loans: Do you have car loans or other loans?
- Mortgages: If you have a house loan, write down the balance left.
- Student Loans & Other Debts: Include any unpaid school loans or taxes.
Step 5: Summarizing Net Worth
Your net worth is what you own minus what you owe. Make sure the numbers are right:
- Total Assets: Everything you own.
- Total Liabilities: Everything you owe.
- Net Worth: Assets - Liabilities = Net Worth.
Step 6: Income & Extra Financial Info
This part is about your income and any other financial stuff:
- Income: Write down how much money you make from work or other sources.
- Contingent Liabilities: If you’ve co-signed a loan for someone, mention it here.
Step 7: Additional Sections
Here are a few more things you might need to fill out:
- Notes Payable: List any loans you still owe money on.
- Stocks, Bonds, & Real Estate: If you have investments, describe them.
- Other Assets: If you have anything else valuable, describe it.
- Unpaid Taxes: If you owe any taxes, make sure to include them.
Step 8: Final Steps & Signatures
You’re almost done! Now, finish up:
- Sign the Form: You and your spouse (if you have one) need to sign the form.
- Gather Documents: Depending on what your lender asks for, you might need to add extra paperwork like tax returns or pay stubs.
Helpful Tips
- Be Honest: Don’t guess or make stuff up. The SBA wants the real info.
- Talk to Your Lender: If you don’t know what to put, ask your lender. They want to help you get it right.
Final Thoughts
Filling out the Personal Financial Statement (PFS) may look tough, but you can do it one step at a time. Make sure your numbers are right, gather everything you need, and don’t be afraid to ask for help. When you’re done, you’ll be closer to getting the funds you need to start or grow your assisted living business.
Next Steps?
Are you ready to take the next step in your assisted living investing journey? Download our Business Plan Checklist, which will guide you in creating a successful business plan for your assisted living facility.
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 key part of getting an sba loan is the personal financial statement or the pfs this form although can feel a little bit daunting especially if you are new to the process of working with sba or if you're just kind of not great at your personal finances in today's video i'm going to give you a full tutorial on how to fill out a pfs for your sba loan hi everybody i'm brandon gustafson i own and operate two assisted living facilities and i created this channel to help people just like you learn the ins
00:00:27
and outs of investing in assisted living welcome to assisted living investing [Music] hey welcome back to the channel in our last video we talked about where can i find a policy and procedure handbook for sale make sure you go and watch that video if you're looking for a set of policies and procedures and trying to find out a place where you can buy them in today's video we're going to be getting into a full tutorial on what the personal financial statement is or the pfs as you are trying to get an sba loan
00:01:05
so first off what is the personal financial statement so this is a standard form that is provided by the sba it's actually like a specific form that they give to you it's not anything that you're trying to fill out and put together by yourself they give you the form and it really kind of outlines everything that you need as you're going through it basically you are listing off all of your assets and all of your liabilities to find out what your net worth is and then giving that so your assets are
00:01:32
the things that you own that are worth money so think you know your house your car your 401k any investments these are assets and then your liabilities are the things that you owe money for um so think something you know like a credit card or a car payment or your home mortgage a student loan payment these are all liabilities and so you're just kind of listing them out in the pfs there are kind of two big main sections that you need to fill out number one is those high level numbers so my assets are xyz my liabilities are abc
00:02:11
and just the really high level numbers of what those are if they give you the categories so that you can fill them out it's really simple the next part is a little bit more lengthy and you are giving more line item detail about your specific assets and liabilities i owe this much on my school loan i owe this much on a credit card my house is worth this much this is where it's located it's worth this much and i owe this much on the mortgage those types of things and so it's allowing you to kind of put
00:02:39
that information in there and break it down so they can go in and just you know make sure that they're comfortable with you as a person and your net worth in getting access to the funding that they're going to provide you with through the sba loan all right welcome over to the tutorial so this is what the personal financial statement is going to to look like as you get it open so this first page is really basic uh what you're going to be doing on here is just clicking the button for which one you're looking at and i'll
00:03:10
point out to you as well different lenders are going to have different versions of this they are largely the same some of them are going to be fillable some of them you're going to have to print off and do some of them you're going to just have to adjust it from this bank they gave me a really good version of it and it's fillable and i can interact with it so it's something that you kind of want to look at so you know in this case we're going to do an sba 7a loan and so you just kind
00:03:33
of click that but if you're looking at a different type of loan you would just go through and do it i'm guessing that you know 97 of you that are doing this are doing a 7a or a 504 loan so that's going to be the option that you do some of them might not even have this first page um on here but it's something that you just kind of want to be aware of so from here you're going to get into the the next version of this and it's really simple here at the beginning this is your name so your first and last name
00:04:02
if you have a business phone and a home phone you're just putting those numbers it is the same number just put the same number business phone for me is my cell phone number um then you're going to put your home address in here and this is just the the line version of it so one two three my street and then down here is where you're doing the city state and the zip code so they go on separate lines something else that you just kind of want to be aware of as you're doing that this is the business name of the
00:04:29
applicant um or the borrower so if you have a uh a specific entity on here this is where you would put that so this is your personal name up here this is the name of the business so if you already have an entity that you're putting this in you're gonna put that entity name in on this section right here um so that's where you do that and then if the businesses address is the is a different one you're gonna put it in here if it's the same address as above you can leave this blank
00:04:57
so down here you're going to get into what type of business are you working with you're probably going to be an llc so you can just click on llc or put an x whatever you need to do for that section depending on the form that you're working with but you just kind of indicate which type of business you are and then this is the information when you are providing it so you just do the date um you know the date that you're filling this out on so you're just gonna do today's date um
00:05:24
basically and then is this um the wosb applicant only so this is up here it's talking about the women-owned small business that's what a w-o-s-b is so you just that's the only spot where you need to indicate this so if you're doing a 7a or a 504 loan you don't need to worry about it you could but if you are doing that applicant application then you could do yes so i'm going to go back and just retract what i said earlier if you are a women-owned small business you may look at that option as opposed to doing
00:06:00
a 7a and a 504 obviously i am not a woman so i can't apply for that but it's something that you may consider doing because you may be able to get certain types of funding that i just can't get because because i'm a guy so it's just something that you may want to look at talk to the lender about the pros and cons of that type of a loan um everything else in here is going to be the same so i retract what i said and sayings 97 of you are going to do this it's probably like you know 70 80 are
00:06:27
going to do this and then maybe a handful of people will will end up doing this one um but it's talking with the lender what what's going to work for me what's going to be best for me so i apologize for that as we get down here into the assets column so this is you know cash on hand and in banks and then savings accounts i typically nobody's going to go in and audit this information i typically just put my cash in hand checking savings account everything i just put into the the first one but if
00:06:56
you wanted to break it out and have it be a certain saving account then you could do that if you've got a cd or something like that maybe you're putting it in as a separate account here if you have an ira you're going to do that this is accounts and notes receivable so if somebody owes you money a business owns money and you can see here so this is described in section 5 section 8 we're going to get that down into that here in just a minute but you are just putting the amount in
00:07:21
here and then down in those separate sections you're going to be putting in more specifics around what it is life insurance this is only cash value so if you have just a term life insurance and it doesn't have any cash value you're not going to add anything here this is only if you have a cash value life insurance your stocks and bonds if you have any of those you're going to put the cash value of those same with your real estate this is not asking you for how much equity you have in your house it is how much
00:07:48
your house appraises for what it's worth um you don't need to necessarily go and get an appraisal for it just getting like a zillow value is going to be totally fine um in getting that information um for the purposes of of this um thing and sorry if the camera bounces around a little bit um my i wanna i'm on a tv tray trying to do this so apologize for that um automobile same thing so if you just like got on kellybluebook.com and got the value of your car it doesn't need to be specific just kind of a rough
00:08:19
number that's going to be sufficient and then any other personal property here you're going to add into that is what you would do and then other any other assets you're going to add that some of these forms are going to automatically tally um the amount that you're putting in here they'll automatically do it so it gives you a total some of them won't do that and so you'll just have to go do a calculator on the other side and get that information and put it in here the other thing that i'll point out is
00:08:47
it says to omit cents so you know if you had 5 267 and 29 cents you're gonna just leave off that 29 cents um here on the cash on hand um that's that's what that means now accounts payable is going to be you know if you owe somebody money it's going to go up here notes payable to a bank or to others can go in here so you're looking at things you know like credit cards or or different things like that are going to go into into this section your installment account for an auto you're going to put in you know
00:09:22
this is how much i i owe on it and my monthly payment is this much any other installment account so if you had multiple cars you could kind of put that in there if you if you were you know you had leased a refrigerator from a furniture store and you had to do something you kind of put that in here as well so it's just kind of how you might fill that out a little bit if you have any loans against your life insurance policy so you have a cash value life insurance and then you have put in a loan against it
00:09:51
you kind of put that in there that's a liability your mortgage on your real estate so this one on the real estate you are putting in that zilla value this is getting your statement and seeing how much do i owe on the house at that point so you're putting that in there any unpaid taxes that you have any other liabilities that you might have and you would describe these again down here in section seven so this is a really good spot to like put your school loans in for example then this one
00:10:19
this specific form does not tally up total liability so i would just pull on a calculator add all those up and that gives me my total liabilities now your total liabilities plus your net worth should equal the total number in this column so this one and this one should be the exact same this right here is a sum of all of these and this net worth is this number minus this number so that's your net worth um is kind of how the net worth works here in the sheet that's how you can figure out what your net worth is which
00:10:56
is kind of a fun thing to do um and and get familiar with so right here section one we'll get into this the sections now section one is your salary how much do you make um do you make any investment income do you make any real estate income and do you make any other income and these are your contingent liabilities as an endorser or a co-maker legal claims and judgments provision for federal tax income and any other special debt so any other debt that you might need to throw in here is where you're
00:11:25
going to put it and then if you are doing any other income you need to make sure you're listing it out in here so if you did this other income and you're getting money from some kind of investment or a different business or side hustle or something like that you want to make sure you're listing it out here how much money you're making in there so they can count it towards your total income it's just going to benefit you if you have additional income in there now section 2 is notes payable to banks
00:11:53
and others so this is like where i would put in my credit cards so you know i put in a chase credit card my original balance i usually just put in zero here because it's just a credit card sorry um and then the current balance how much i owe what the payment amount is um monthly if it's a credit card you're doing um unsecured is what it is um if it's a heloc or something like that a home equity line of credit um you put in the real estate or whatever it is that you need to put in there so that's kind
00:12:22
of what you're putting in here for section two the notes payable to banks and others uh number three is your stocks and bonds so if you own if you have any stocks and bonds you're putting in here these are the number of shares securities costs etc you're putting all of this information in here the market value um quotation exchange the date of quotation exchange and then your total value um so it's just gonna these are your assets they want to make sure they know how much they're how much you have
00:12:48
available it does not necessarily mean that they're like putting a lien against your stocks and bonds or your 401k or anything like that generally you don't have enough money in there anyways um for it to really make it worth it for them and it's just kind of hassle and so they don't do that but they want to know how much is in it to see how liquid you could become if you absolutely need it to be number four is going to be real estate owned so they give you three options here now if you have more than three
00:13:15
real estate properties you're just going to need to do an attachment and just add an additional section of this um section for here so type of real estate is you know personal residence or it's a rental property or a secondary residency like a cabin or it's land or something like that you're this is that's what this top section is and then right here is the address of the property and this one you're doing street address and city state zip all in this section right here this is when you purchased it the
00:13:46
original cost of the real estate that you purchased and the present market value so this will show how much it has appreciated in value over the time that you've owned it which kind of a cool thing to look at and see especially right now while we're seeing values go up quite a bit this is the first part of 2022 so everything is is worth a lot of money which is exciting hopefully it stays that way we'll find out um soon i guess um let's see name and address of mortgage holder so this is not
00:14:13
you this isn't your name and address this is the bank that you are paying to um so you know u.s bank and then just do their address just their general address that they they have if you just look them up online your mortgage account number so this is the actual account number that is on your mortgage this is so if they need to call and verify the mortgage or anything like that they're able to do this and get the information from them they may even send off a letter to them and that's why they have
00:14:43
this address information here to make sure that you are current on on your payments mortgage balance balance is how much you currently owe on that real estate um so there's that and then the amount of payment per month um or a year so what's your mortgage payment essentially is what this one is and then the status status of the mortgage is you know in default current whatever your status is on on that section five is other personal property and other assets so you're just going to describe what
00:15:14
those are and it gives you a few examples here so do you have anything that's pledged as security um you know you want to put the name the address of the lien holder of anything like that the amount of the lien the terms and payments just kind of give an overview of personal property and other assets if you have questions about this about like how do i need to fill this out i would suggest talking to the lender and see what they want to put in there if you have a question about anything on here you just want to make
00:15:44
sure you have a conversation with the lender and make sure that you're giving them what they need is what i would suggest any unpaid taxes if you owe any taxes um you should make sure that you are being transparent here and giving that information as it's outlined here um the type to whom you need to make these payments uh when it's due the amount and what property if any tax lien has been attached to they just do that because if they need to put a lien on any of your properties it's going to put them in like third
00:16:15
fourth position which has like no value on it so just need to kind of be aware of of that this is any other liabilities so you're just gonna describe this in detail so this is like if you have school loans this is a good spot to do it section seven um right here in other liabilities section eight is life insurance held so i have a cash value life insurance is worth a hundred thousand dollars and i was using 50 000 of it to to do another investment and so you just kind of put that in here um and then down here at the bottom is
00:16:44
just where you sign and data so something that's really important for you to understand if you are if you are married you actually need to have your spouse also do this because they are putting their information into it you are if you're married filing jointly specifically you are viewed by the government as a single entity so you need to have this information from both you and your spouse um to make sure it's on here so you're just printing the name here the date that you're just printing
00:17:14
the name here you're doing the date of when you have filled this out and the social security number of you and your spouse then it does need to be a wet signature in my experience so you need to print it off and actually sign it and then scan it back in and the rest of this the rest of the form is just a bunch of words you can read it and i would suggest if this is the first time you're doing it that you do read it because it's giving you a lot of information about how they use it what they're checking against
00:17:41
and and things like that but if you are doing this and you know you're you're pretty comfortable filling out the pfs statement i've done a lot of these over the last couple of years um then you don't necessarily need to read through all of it uh it's good to skim it make sure that everything's up to date they haven't changed anything but largely it's going to stay the same but yeah that is how you fill out a pfs a personal financial statement for an sba loan hope this
00:18:09
tutorial was helpful for you i hope that tutorial was helpful if it was make sure you smash that like button and subscribe to the video because it's going to allow other people to kind of find this content and this information to help them as they're trying to find their get on their own journey to get into assisted living in our next video we're going to be getting into how to fill out a an sba 1919 form specifically section one this is another form that you're going to have to do as you're getting sba funding
00:18:36
in place so we're going to get into that in our next video 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 you can schedule a call with me we can chat about the process of getting an sba loan as you're going through this to purchase your own facility and remember it doesn't take a lot just a little bit just keep going keep making progress step by step by step if you do and
00:19:00
you're consistent i promise you that you will be successful thanks for watching and have a great day [Music] you
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