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Small Business Owners - Talk the Talk Before Walking the Walk

Commercial Mortgage
Posted on 
August 21, 2012

For small business owners looking to borrow money, it’s important to know your commercial lender as much as the lender wants to know you.

What’s one way to find out about each other? Have a conversation. It’s important for the borrower and the lender to speak directly to each other during the application process to discover if they are the right fit for each other.

By simply talking to a commercial lender and telling them about your borrowing needs, you could be on your way to accomplishing your financial goals.

For potential borrowers who are self-employed or small business owners, looking for a small commercial loan between $25 and $500K may be time consuming. Understandably, your day is filled with working on cars at your auto repair shop or your focus is on the children at the day care center that you own/operate. If you’re running around managing your multi-unit apartment buildings, how can you afford the time away from your busy schedule to discuss the details of your commercial loan? The answer – you can’t afford not to!

These days, the tables are turning and the commercial lender has to pass muster for the borrowers. Many small business owners who are looking to borrow money want to know more about who is lending it to them. Are there hidden costs, terms or fees? Will your commercial loan be sold over and over again? Who will service your loan? How much experience does this lender have in the industry?

Here are a few suggestions for small business owners to prepare for a discussion with a commercial lender:

Best Tips for Discussing A Small Commercial Mortgage with your Lender

What the Commercial Lender will want to know about you…the “4 Cs”:

  • Credit: Know your credit score and understand your credit report. Your credit report is one of the most important tools used in making lending decisions. Be prepared to discuss any account delinquencies, past bankruptcies, or financial “bumps” you may have experienced.
  • Collateral: Know the facts about the property you are pledging as collateral.
  • Capacity to Pay: How will you manage your new commercial mortgage payment?
  • Character: How have you managed past financial obligations and responsibilities?

What you may want to know about the Commercial Lender:

  • Experience: How long has the commercial mortgage company been in business?
  • Process: After I complete the commercial loan application, what happens next?
  • Costs: Does the commercial lender charge upfront fees?
  • Service: Who will be servicing my commercial loan?

With the talk taken care of, you can begin the walk that will guide you to your financial destination.


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