Why Banks Ask for a Comfort Letter (And What You’ll Need to Provide)

If you've recently applied for a loan or line of credit for your business, there’s a good chance the lender asked for something called a comfort letter—sometimes referred to as a CPA letter or verification letter. These requests can catch business owners off guard, especially if the bank makes it sound like a quick favor.

But here’s the truth: comfort letters are formal documents with serious implications—and they require more than just a signature.

What Is a Comfort Letter?

A comfort letter is a statement—usually written on a CPA’s letterhead—intended to reassure a lender or creditor about a borrower’s financial status. The request might ask us to:

• Confirm your business income
• Verify self-employment
• Assure them your tax filings are current
• State that you’re financially able to repay a loan

Sounds simple, right? But here's the problem:

Accountants are not allowed to "guarantee" future financial performance or certify information they haven’t independently verified. We follow strict professional standards, and comfort letters require careful review of your tax returns, financials, and sometimes additional documentation before we can issue one.

Why Do We Charge for Comfort Letters?

We understand that to you, it may feel like “just a letter.” But behind that letter is:

• Time reviewing and verifying your documents
• Professional risk: If the bank relies on our letter and you default, we could be held liable
• Compliance standards we must follow from the AICPA and IRS

Our firm takes your financial credibility seriously. We only sign letters that are factually accurate, professionally compliant, and backed by proper documentation. That’s why there’s a fee for this service—because it’s not just paperwork, it’s professional assurance.

What You May Need to Gather

Whether you’re applying for a commercial loan, equipment financing, or just a line of credit, your lender will likely ask for more than just a comfort letter. Be prepared to submit a full financial package to support your application.

Here’s a standard checklist:

📋 Loan or Financing Checklist for Small Business Owners

Summary & Support Documents

• A brief letter outlining your loan request: how much, why, and how you’ll repay it
• Purchase agreement, invoice, quote, or contractor estimate (if applicable)
• Break-even analysis for revenue-generating purchases
• 1-year business plan and cash flow projection
• 5-year business plan (for larger loans or new businesses)

Financial Statements

• Most recent business financial statements (P&L and balance sheet)
• Aged accounts receivable report
• Prior 3 years of business financials
• Prior 3 years of business tax returns
• Depreciation schedule (if you have equipment-heavy operations)

Owner Documents

• Prior 3 years of personal tax returns (for each business owner)
• Personal financial statement for each business owner
• Copies of any franchise or lease agreements
• Photo ID and proof of ownership (especially for new entities)

Real Estate-Specific (if applicable)

• Legal property description
• Rent roll and lease copies
• Zoning verification
• Historical expense reports for the property

In Summary

If a bank or lender asks for a comfort letter, please don’t assume it’s something we can sign on the spot. It’s a formal document that requires due diligence and documentation—and we’re here to help you through it.

If you’re getting ready to apply for financing, reach out to us early. We can help make sure your financials are in order and assist with preparing a full loan package—giving you the best chance for approval.

Have questions? Need a comfort letter? Contact our office and we’ll walk you through the process.