Create an SBA Form 160 Online

SBA Form 160 is required in several specific situations within the SBA lending process. Understanding when this form is needed helps businesses prepare for the loan application and avoid delays.

SBA 7(a) loan applications: The 7(a) loan program is the SBA's most common loan program, providing loans up to $5 million for a variety of business purposes including working capital, equipment purchases, real estate acquisition, and business acquisition. SBA Form 160 is required for all 7(a) loan applications made by corporations and other entities that have a board of directors or equivalent governing body. The form authorizes the officers designated by the board to negotiate and execute the loan documents.

SBA 504 loan applications: The 504 loan program provides long-term, fixed-rate financing for major capital assets such as real estate and equipment. Like the 7(a) program, the 504 program requires SBA Form 160 from corporate borrowers. The resolution authorizes the designated officers to apply for the 504 loan and to execute all documents necessary to complete the transaction, including the note, deed of trust or mortgage, and other security documents.

SBA disaster loan applications: When a business applies for an SBA disaster loan following a declared disaster, corporate borrowers must submit SBA Form 160 as part of the application package. The form authorizes the designated officers to apply for disaster assistance and to execute the loan documents if the application is approved.

SBA microloan applications: The SBA microloan program provides loans up to $50,000 to small businesses and certain nonprofit childcare centers. While the documentation requirements are less extensive than the 7(a) or 504 programs, corporate borrowers are still required to submit a board resolution authorizing the loan. SBA Form 160 satisfies this requirement.

Loan guarantees: When one organization guarantees an SBA loan made to another entity, SBA Form 160 is required from the guaranteeing organization. The resolution authorizes the designated officers to execute the guarantee on behalf of the organization, committing it to repay the loan if the primary borrower defaults. The form includes specific language for guarantee authorizations.

Loan modifications and renewals: When an existing SBA loan is modified (such as changing the loan terms, extending the maturity, or increasing the loan amount) or renewed, a new SBA Form 160 may be required. This ensures that the current board of directors has authorized the modification or renewal and that the officers executing the documents have current authorization.

SBA Form 160 contains several specific sections that must be completed accurately to ensure the form is accepted by the SBA and the lending institution.

• Organization identification: The full legal name and address of the borrowing organization. This information must exactly match the organization's formation documents and the other SBA loan application materials. Any discrepancy can delay the loan approval process.
• SBA application/loan number: The SBA assigns a unique number to each loan application. This number is used to track the application through the approval process and must be included on all related documents, including Form 160. If the form is being submitted with the initial application, this number may be assigned by the lender.
• Loan amount: The maximum principal amount of the loan being requested. This amount should match the loan amount stated in the loan application and other supporting documents. The resolution authorizes the officers to borrow up to this amount, so it should be set at the level needed to cover the full loan request.
• Lender identification: The name of the bank or lending institution through which the SBA loan is being processed. SBA loans are typically made through participating lenders (banks, credit unions, and other financial institutions) rather than directly by the SBA, so the lender's name is an important component of the form.
• Guarantee provisions: If the organization is guaranteeing a loan to another party, the form includes space to identify the guarantee amount and the name of the loan recipient. This section is only completed when the organization is acting as a guarantor rather than as the primary borrower.
• Authorized officers: The names and titles of the officers, employees, or agents authorized to act on behalf of the organization in connection with the SBA loan. The form accommodates up to four authorized individuals, and their actual signatures must be affixed to the form. These individuals will be authorized to execute all loan documents on behalf of the organization.
• Secretary certification: The corporate secretary (or equivalent officer) must certify that the resolution is a true and correct copy of a resolution duly adopted by the board of directors at a meeting at which a quorum was present and voting. This certification includes the date and location of the meeting and the secretary's signature.

Understanding where SBA Form 160 fits within the broader SBA loan application process helps businesses prepare all required documentation and avoid delays.

Step 1 — Determine eligibility: Before applying for an SBA loan, the business must meet the SBA's eligibility requirements. The business must be a for-profit entity operating in the United States, meet the SBA's size standards for its industry, demonstrate a need for the loan proceeds, and show the ability to repay the loan. The business owner must also have invested their own time and money in the business and must have exhausted other financing options.

Step 2 — Find a lender: SBA loans are made through participating lenders, not directly by the SBA. The business should identify and approach lenders in its area that participate in the SBA lending program. SBA Preferred Lenders have delegated authority to approve loans, which can expedite the process. The SBA's Lender Match tool can help businesses find participating lenders.

Step 3 — Prepare the application package: The loan application package typically includes the SBA loan application form, business financial statements, personal financial statements of the owners, business plan, tax returns (business and personal), legal documents (articles of incorporation, bylaws, operating agreements), and SBA Form 160. Having all documents ready when applying can significantly reduce processing time.

Step 4 — Board authorization: Before the application can be submitted, the organization's board of directors (or equivalent governing body) must adopt a resolution authorizing the loan and designating the officers who will execute the loan documents. This is where SBA Form 160 comes into play. The resolution should be adopted at a properly convened meeting with a quorum present, and the secretary should certify the resolution on the form.

Step 5 — Submit and process: Once all documentation is complete, the application is submitted to the lender, which reviews it and makes a credit decision. If the lender approves the loan, it submits the application to the SBA for its guaranty (in the case of 7(a) loans). The SBA reviews the application and, if approved, issues a loan authorization. The lender then closes the loan and disburses the funds.

Step 6 — Closing: At closing, the authorized officers identified in SBA Form 160 execute the loan documents on behalf of the organization. This includes the promissory note, security agreements, and any other documents required by the lender and the SBA. Only the officers named in the resolution should sign the closing documents.

The authorization of officers is a critical component of SBA Form 160 and the SBA loan process. Understanding the requirements and best practices for officer authorization helps ensure the loan proceeds smoothly.

Who can be authorized: SBA Form 160 allows the organization to authorize officers, employees, or agents to act on its behalf. In practice, the authorized individuals are typically corporate officers such as the president, vice president, secretary, or treasurer. However, the form is flexible enough to allow any individual designated by the board to serve as an authorized signer, including external agents such as attorneys or consultants.

Number of authorized officers: The form accommodates up to four authorized officers, but there is no minimum number required (beyond the first officer, which is required). Having multiple authorized officers provides flexibility in case one officer is unavailable when documents need to be signed. However, each authorized officer should be someone who understands the loan terms and has a fiduciary responsibility to the organization.

Actual signatures required: SBA Form 160 requires the actual signatures of the authorized officers to be affixed to the form. This means the authorized officers must physically sign (or provide acceptable electronic signatures, where permitted) the form. A signature by proxy or a stamped signature is generally not acceptable. This requirement ensures that each authorized officer has personally acknowledged their authority and responsibility.

Officer qualifications: While the SBA does not specify formal qualifications for authorized officers, the officers should be individuals who have the organization's trust to manage significant financial obligations. They should understand the loan terms, the organization's obligations, and the consequences of default. Officers with financial, legal, or management expertise are typically the most appropriate choices.

Changes in authorized officers: If an authorized officer leaves the organization or is replaced after the form has been submitted but before the loan closes, a new SBA Form 160 should be prepared and submitted reflecting the current authorized officers. If changes occur after closing, the organization should notify the lender and prepare updated authorization documents as needed.

Personal liability considerations: Being named as an authorized officer on SBA Form 160 does not, by itself, create personal liability for the officer. However, the SBA often requires personal guarantees from owners who hold 20% or more of the business. Officers should understand whether they are being asked to provide personal guarantees in addition to their role as authorized signers for the organization.

Errors on SBA Form 160 can delay the loan approval process or, in some cases, create legal issues. Awareness of common mistakes helps organizations prepare the form correctly the first time.

Incorrect organization name: The organization name on Form 160 must exactly match the name on the articles of incorporation or articles of organization. Using a trade name, doing-business-as (DBA) name, or abbreviated version of the legal name can cause the lender or SBA to reject the form. Always verify the exact legal name before completing the form.

Mismatched loan amounts: The maximum principal amount stated in the resolution should match the loan amount in the application and other supporting documents. If the amounts don't match, the lender may require a new form to be prepared. If the loan amount changes during the approval process, a revised Form 160 may be needed.

Missing officer signatures: Each authorized officer must actually sign the form. Missing signatures make the form incomplete and will delay processing. Ensure all authorized officers are available to sign before the form needs to be submitted. Planning ahead for officer availability can prevent last-minute delays.

Improper certification: The secretary's certification must accurately reflect the circumstances of the resolution's adoption. Certifying that the resolution was adopted at a meeting when it was actually adopted by written consent (or vice versa) can create legal questions about the resolution's validity. Ensure the certification language matches the actual adoption procedure.

Not including meeting details: The form requires the date and location of the meeting at which the resolution was adopted. Omitting this information or providing incorrect details can raise questions about whether the resolution was properly adopted. If the resolution was adopted by written consent, note this on the form instead of meeting details.

Outdated officer information: If the form is prepared well in advance of submission, the authorized officers may have changed by the time the loan is processed. Always verify that the officers listed on the form are still serving in their stated capacities before submitting the form. Submitting a form with outdated officer information can delay closing and may require a new resolution.

Forgetting the guarantee section: If the organization is guaranteeing a loan to another party, the guarantee section of the form must be completed. Leaving this section blank when a guarantee is involved can delay processing and may require a new form. Conversely, completing the guarantee section when no guarantee is involved can create confusion.