When you have made the difficult decision to go into business, you hate to be slowed down by the need to fill out countless loan applications. But if you keep these four things in mind, it may not be too difficult to navigate through your commercial lending options.
So the day finally came when I decided to do it. I was tired of seeing my talent and expertise make money for corporate, so I decided it was time to venture out. It was time to strike out on my own. It was time to make my own way; to be my own man.
That is if I could find a commercial lending institution that would give me the money I needed to make it happen.
The Hunt For The Next Great Commercial Lending Option
The financial landscape was quite cavernous and difficult to traverse on my own. But luckily, I was able to have a meeting with a friend of a friend that worked for a local bank, and he told me the four factors every lender would be interested in:
• Credit Score: Since I didn’t have any business history yet, he said lenders would be interested in my credit score so they could get an idea how I’ve handled finances throughout my life. A traditional lender would want to see a good one while some alternative lenders would be okay even if my score were down around 500.
• Time in Business: traditional routes will want to see my business operate for a year or two before approving a loan. They want to see the business working and generating money. That way they know, you’ll pay them back. An alternative lender may only want you to be up and running for a couple of months.
• Revenue: Just having your doors open for business will not be enough. Lenders will want to see your business generate revenue. That way they can feel good about the possibility of you paying them back.
• Collateral: Traditional lenders are going to want to have some assurance that they will see their money again and will require you present something of value as collateral. Several types of collateral can be used to help get your loan approved including—deposits, home equity, investment real estate, and equipment to name a few.
The Buck Stops Here
After my meeting with my friend’s friend, I realized that I would never see a dime from a bank. I would have to go the alternative route to have my commercial lending needs met. With a loan from my brother, I was able to get my business off the ground, and will soon have all the capital I need thanks to my friendly, neighborhood hard money lender.
Once I learned what it took to get approved by certain lenders it was easy for me to see what I needed to do. Thankfully, I was able to talk to someone and learn about them before wasting too much time preparing and turning in application packages all over town!
Dennis Dahlberg Broker/RI/CEO/MLO
Level 4 Funding LLC Private Hard Money Lender
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701
About the Author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.