Personal & Small Business Loan Program Guidelines

What a good one includes

• Detailed borrower eligibility criteria, including minimum credit scores, debt-to-income ratios, and time-in-business requirements for commercial applicants.
• Clearly defined loan terms outlining the minimum and maximum loan amounts, repayment periods, interest rate ranges, and fee structures.
• Specific collateral and personal guarantee requirements detailing what assets are acceptable and how they must be valued.
• A comprehensive document checklist for applicants, specifying required tax returns, bank statements, profit and loss statements, and identification.
• A step-by-step underwriting and approval workflow that maps out the timeline from initial application submission to final funding.
• A list of prohibited loan uses and restricted industries to ensure compliance with your risk tolerance and regulatory boundaries.

Common mistakes to avoid

• Using vague eligibility terms like credit score minimums instead of specifying exact FICO score bands or acceptable credit profiles.
• Failing to include a clear state-by-state lending footprint or licensing disclaimer, which can lead to accidental regulatory violations.
• Omitting an official exception policy, leaving your team without a structured way to handle strong files that fall slightly outside standard guidelines.
• Neglecting to define broker compensation, referral fees, or points, leading to disputes and damaged relationships with your deal originators.

Frequently asked questions