How Preparing a Business Plan Can Help You Obtain a Commercial Real Estate Loans

Commercial real estate loans may seem hard to get approval for, but not if you have one of the key components lenders look at — a strong business plan. Here are some simple tips for creating a strong business plan.

4page_img6-bigStart with a summary — strong statements that serve as the outline of your plan. This should inform the reader of exactly what you truly want to do with your business, what you are requesting and how it will be used to grow your company. This should come directly after the title page.

Next include a description of your company and the industry in general. Don’t assume the banks have an in-depth knowledge of your particular niche. Include information about current trends and future opportunities for growth and revenue. In addition, noting specifics about the markets in your specific industry and some of the new developments that you can use to leverage your own business is beneficial to a strong business plan.

A market analysis should be included in your business plan. Hard numbers that show all aspects of the market that can be defined in a way to position your company as a strategic player in this field. Include your own unique market strategy approaches and ideas here too. In addition to market analysis, including an analysis of your direct competition — and their strengths and weaknesses — is another critical element of a strong business plan. This shows your ability to pinpoint problems, and an opportunity to present solutions. You can explain here how your company would avoid these same pitfalls or build upon these same areas of strength.

How will a business plan determine whether a bank or lender will approve my commercial real estate loan?

Additional factors such as your business development strategies, how you will chart and track production, market the company, create and stick to a budget, managing the day-to-day business operations running smoothly, any specific logistics, and charting the responsibilities of your management team all point to your ability to run your company successfully. Banks and lenders need to feel confident that they will see a return in their investment. It’s your job to sell that to them and ultimately get them to approve your commercial real estate loan.

Making your business plan stand out is almost as important as what your business plan includes.

Using the proper tools to present your business plan is crucial. Presenting in a clean and easy way with real numbers, facts, and any hard data you have to “prove your case” can be beneficial to your commercial real estate loan approval.

Dennis Dahlberg
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177 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.

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