Last call….Closing Time!

July 08, 2024

Is this ever going to end?  You have reviewed all the loan documents and are ready to close.  However, it is important to understand what you will be doing the day of the closing.  Below are a few things to discuss with your business counsel, lender and any other business advisors that are assisting you with this process. 

  1. Loan Agreement – This is the agreement that we reviewed last week.  It will be signed at the closing
  2. Guaranty – This is the document, if required, that you or some other person or entity will sign to ensure that the loan gets paid in case of default
  3. Legal Opinion – This is the opinion of your attorney basically saying that the loan is enforceable (there is more that is included in this letter, but this is the simple way of explaining its importance)
  4. Perfection Certificate – this is a certificate that you provide to the lender that describes any collateral that you own and any other details about you or your entity for the lender
  5. Schedules – any required disclosures that you need to make related to the loan (e.g., subsidiaries, existing debts and liens, real property, lender commitments, litigation, liabilities, required consents and authorizations, etc.)
  6. Deposit Account Control Agreement – This is the agreement that allows the lender (or secured party) to obtain control over your deposit account (or accounts) in the event of a default.
  7. UCC Financing Statements – These documents are the record or records which show the lender’s position over the assets you pledged as collateral for the loan.
  8. Mortgage – If real estate is involved or you pledged your owned real estate for the loan, you may be required to sign a mortgage.
  9. Good Standing Certificates – If your entity is borrowing money, the lender will typically require that you provide a current certificate of good standing from any state your entity is registered
  10. Flow of Funds Statement – This is the statement that shows you how much is being borrowed, what fees are being paid, any existing debt that is being paid off and the net amount of the loan proceeds being disbursed
  11. Payoff Letter – This is the letter that is provided by any existing lender that is being paid off at closing

There are many other documents that also could be required.  It is important that you are working with experienced business counsel when taking on a business loan.  Each of the required agreements of the lender has a particular purpose and should be understood by you or your team. 
Other items of interest

As always, please don’t hesitate to email myself (, Andy Miller (, Christian Miller (, Erik Spurlin (, Brad Leber ( or anyone in our office with questions or comments.   

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