Not all of us are looking to become professional lenders and may not ever need to know anything about commercial lending, but if you are in the market for extra funding for your business, it is important to know the basics.

Obtaining extra funds for your business through a loan isn’t always easy. That is why the more you know about the foundation and the process of commercial lending, the better. Working with lenders can be a struggle and the more confident you are, the easier the whole process will be, from beginning to end.

There is a lot of evaluating that takes places when it comes to commercial lending. Credit is extremely important and your personal credit score along with any business credit score will be looked at heavily. Your credit scores say a lot about you and your business, especially your ability to paying back debt.

Your character is also often times looked at closely under a microscope. Just like with most things, especially in the business world, your character is going to weigh heavily on your loan offer. This is shown by how you have performed in the past with regards to your business and decision making. This is also where your personal credit score and business credit score will be looked at.

Commercial lending isn’t taken lightly and you will get more with an impressive credit score and background.

Along with your personal credit score and your business credit score, your other personal and business financial statements are evaluated. And it is important to include as much information as possible as it is will come in handy when commercial lending is needed. The more financial information you can supply, the better and the higher chances of approval. This is why being prepared at the very beginning of the process can help you avoid any denials.

The terms and conditions of commercial lending can play a role in approving or denying your extra funding request.

When applying for a loan, you want to make sure that you are strong in your request, but also flexible. Specific conditions might be brought up and the more you can come to terms with your lender and meet them in the middle to make all parties hapy, the better the entire situation will be. This is another way of proving your character to your lender. All lenders are looking for is proof that you will be able to repay back your loan in a timely manner. The more you can prove your ability to do so by providing excellent credit scores, detailed financial statements and a reputable character to go along with it, the better the outcome will be.

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

When it comes to commercial lending documentation, it is best to start the process off organized. The earlier the best, like as soon as you received all of the information from the lender.

The documentation needs to include all of the important information needed and needs to be balanced to make bother the borrower and lender happy during the commercial lending process. Customer service is always crucial, especially when it comes to loans. Detailed documentation will make the whole process much easier and ensure that everyone involved in satisfied.

But when it comes to making sure that you are getting detailed documentation, doesn’t mean you can lack in the customer service department. There are things that you should consider when it comes to your loan documentation. It is important to have a building relationship between the lender and customer. Dealing with financials can be tough and personal, so there needs to be enough respect between the two to be able to deal with the crucial financial questions and information that goes along with getting a proper credit analysis.

The entire application can be stressful, so make sure that the whole commercial lending process is clarified and everything is explained. Establishing a list that includes everything that you will need for proper documentation is a good start. To avoid slowing down the process, make sure you have all of the information you need for a complete and thorough application. Checklists can really come in handy so everyone is aware of the status on everything during the documentation process. This is an efficient and consistent way to double check that all of the information in the documents is detailed and complete. This might be one of the most important parts of the loan process because without the proper documentation, your application could come with some issues and even be denied.

Software can also lend a helping hand when it comes to completing the right documentation commercial lending.

Technology keeps improving and that means it can play a large role in preparing your documentation. Software can be a helpful tool when it comes to keep all of your information organized and easily accessible at your fingertips. There are a lot of options to choose from so that you do not have to rely on using spreadsheets and calculations to try and crunch all of the numbers by yourself. The commercial lending software offered can do the work for you by entering in the numbers needed and using an automation function to automatically come up with the right numbers. It is still important to understand the data, but when you aren’t an expert, this software can help.

Including the right documentation will raise your chances of experiencing a successful commercial lending process

You will be surprised how thorough and complete documentation will help your chances at getting approved for a loan. Not only does it give the information needed to lenders, but it also proves that you can be organized, which is a good trait to show to your lender.

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Commercial lending is a much different landscape than consumer lending. Knowing a few tips about the lenders and the process can greatly improve your chances of getting a loan.

Appling for commercial lending is a long and often arduous process. The dollar amounts involved are rather substantial and that makes the approval criteria and process much more challenging. Lenders are interested in finding borrowers who will successfully repay their loan and the interest associated with it so that they are making their money. Understanding the lenders point of view and working toward that goal with them can make your loan application process much less stressful and difficult.

It is never a bad idea to keep your options open. Having a rapport with a few lenders is always a great plan. Investing the time to meet with lenders, understand their criteria for lending and just chatting with them about your potential needs will lay the ground work for the day that you do submit a loan application.

It is also wise to think of the lenders that you have relationships with as you would any other vendor. In this case the vendor is supplying you with money but that is after all what a service provider does. It is not dishonest or disrespectful to speak to several lenders for the same loan. You are shopping for the best deal and that is simply smart business.

The only way that you can make a mistake when creating commercial lending relationships is if you are not completely honest with the lenders. You are wasting your time if you are not honest in the information that you are providing about your business and yourself. The information and advice that you are getting will be tailored to the information that you give the lender. And if that information is false then most likely they will not be providing you will accurate or useful tips, information or processes.

Make the Right Impression

Commercial lending is a numbers game and the best credit score and credit history will get you the lowest interest rate. But there can also be a little grey area. This is where the lenders opinion of you and your business comes into play. You want to be honest but also paint the most impressive picture that you can when telling your story. Promote your strengths and successes as well as your goals and how you plan to attain them. Another way to impress a lender is to submit a completed loan application package that looks professionally prepared. Be certain that all of the needed documentation is included and that the format is easy to understand and follow.

Focus on Collaboration

Both you and your lender have a great impact on the outcome of your loan application. By investing your time and effort in the process and application preparation you can greatly improve the outcome. Honesty and professionalism will get the attention of your lender and could be that small difference that convinces your lender to approve your loan application.

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Commercial lending practices change with the economy, markets, and rising or falling risk factors. The end of 2017 is seeing historical challenges from regulations as well as emerging risks.

Interest rates have been at historically low numbers for some time even with the Federal Government raising the rates twice in 2017. Moderate job gains and economic activity were noted as the reasons that the interest rates will undoubtedly continue to their third forecasted hike for 2017. This hike in the central bank’s federal funds rate is expected to raise the interest rates of home equity lines of credit as well as credit cards. According to The Risk Management Association, “Rising interest rates on floating rate loans may negatively impact borrower cash flow and result in lower debt service coverages.” This will encourage commercial lending institutions to take a close look at invested equity in order to secure their loans.

Retail issues have been at the forefront of commercial lending concerns for the last two years as more brick and mortar retail stores are shutting their doors in the wake of e-commerce’s takeover. Multi-use projects are taking over the “shopping mall” segment as newer generations place a strong demand on living, working and playing “under one roof.” These multi-use projects have entertainment venues, restaurants, shops, office space, residential units, grocery stores, gyms and even storage spaces. Atlanta developers recently took on a multi-use project next to the Braves new ballpark. It consists of 41-acres with three luxury apartment buildings, entertainment venues, retail and offices and, including the ballpark, came in at $700 million to complete. Of course, it’s still not complete, but is expected to undergo the finishing touches by the beginning of winter.

Regulatory concerns have been raised regarding commercial lending institutions with high commercial real estate loan concentrations. Because of this, underwriting standards have been scrutinized and will reveal this in tightening of their lending belt. Surprisingly, one of the worst performing commercial real estate sectors is construction loans, which has led to a reduction in this sector in bank’s loan portfolios. Multi-family is starting to see some saturation in larger markets while single-family homes are proving to be in high demand, particularly those in the mid-price range. Banks will eventually adjust their lending strategies to reveal these market changes.

Alternative Lenders

With traditional lenders tightening their underwriting standards for various segments of commercial real estate, alternative lenders have become increasingly important to those in these sectors. Contractors, developers and business owners are reaching out to non-traditional lenders with one of these being private hard money lenders. A private hard money lender is not bound by the same FDIC and government regulations and can lend according to their specialized investment portfolios. Because they are asset-based, they do not require impeccable credit scores.

At Level 4 Funding we provide private hard money loans for all sectors of commercial lending including construction, office, retail, small business, industrial, multifamily and multi-use.

Because we work with private hard money lenders, we can approve loans in as little as 24 hours and fund in less than a week. We may very well be able to fund your project when other institutions have rejected your request.

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

At it’s very core, a commercial loan is a business arrangement that is used to fund major purchases or improvements, typically in the real estate sector. Commercial lending specializes in large project that businesses or individuals could not afford to handle financially on their own.

While there are a variety reasons for a borrower to seek out funding through commercial lending, they all have one thing in common. These loans exist to help businesses, whether in real estate or any other field, bridge the gap between operational expenses and increased profit potential. Many small business owners have effectively used this source of funding to leverage their businesses into another level of productivity and profit.

There is a certain level of risk that is associated with commercial lending, on behalf of both the lender and the borrower. With the loan amounts being very large, there is always the potential for some sort of unforeseen circumstance to scramble the best laid plans of even the most qualified lenders. There are many factors that might have an impact on the success of a commercial venture, especially in real estate. Natural disasters, the overall state of the economy and political fallout are all large influences in the success of businesses and all of them are outside of the control of either the borrower or the lender. However, there are ways to minimize the risk so that both lenders and borrowers can steer clear of catastrophe.

Obtaining a loan through commercial lending can be a very time consuming and extensive process. This is very much on purpose, on behalf of the lenders. After all, they are going to be giving the borrower a substantial amount of money and they will need to make sure that their investment is a good one. For traditional loans, the creditworthiness of the borrower is critical. This will immediately let lenders know whether or not the borrower is a risk. If the borrower is determined to be a risk, this does not necessarily mean that they will not be able to obtain funding, but if they do, it will be at a higher interest rate and will most likely have additional requirements. In addition to this, the business that is applying for the funding will have to provide a substantial amount of financial documentation to establish the health of the business. This will most likely include balance sheets, bank statements and tax returns. Depending on the lender, the primary business owner might also have to provide this information about their personal finances.

Are borrowers able to obtain loans through commercial lending multiple times?

Each loan is considered a separate process and procedure, so it is likely that a small business will consistently have a loan floating on their books. However, each loan takes into account the borrowers credit, so multiple inquiries have the potential to hinder further efforts. It is also possible for borrower to renew their loan. Depending on the commercial lending agency, the borrower may be able to roll their loan into a new option for financing. Usually this will offer better interest rates and terms, as the borrower will have established themselves as a lower risk with the lending institution. Assuming, of course, that the borrower responsibly handled the first loan.

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage