Steps to take to find a commercial lender

When looking to finance your next commercial real estate project, you need to find a commercial lender. Why, you might ask? You need someone on your side who is an expert in the nuances of the types of loans that are part of commercial real estate. But finding one can be a bit tricky. Here are some tips to help you find a great business lender.

Commercial banks and lenders often specialize in larger businesses, so finding one that specializes in smaller businesses is often more difficult. The good news is that, especially since 2012, small business loans have been on the rise.

One way to find a small business friendly lender is to look for a smaller lender. Community banks and credit unions are often much more likely to lend to a local business. Why? It is based in part on their ability to know you and your business better than the big boys. It is also based on your willingness to support your local economy by investing in it. Some local banks also participate in the Small Business Credit Initiative, which is a federal program to help boost small businesses.

Another way to get a business loan is to find a lender that offers loans backed by the Small Business Administration. These loans are perfect when you don’t have the criteria that other loans would require to assess your creditworthiness. The SBA supports loans, giving lenders the ability to lend to you without fear. You can check to see if the lender lists that they are an SBA Preferred Lender, or you can check with the SBA for a list of local lenders that are part of the program.

If you can, find out who will actually do the loan evaluation and make the final decision, whether it’s the bank itself or whether you send your loan to an outside company. This may change who you want to work with if you intend to work locally.

Once you find a lender you like and are willing to work with, do some research on the company. You will be with them for several years while you pay off the loan, so you want to make sure you have a good relationship with them. Check the company’s history and make sure there’s a chance it will exist in 10 to 15 years when your loan comes due. You can also check to see if the company offers annual financial reviews to see if there are other financial products they can offer you that might be of benefit.

The Business Finance Association also offers some tips and help in finding a business lender. Their service is free, and you can search based on the type of loan you’re looking for, the amount you want to finance, and where you’re located. The CFA will then give you options for a lender that matches what you are looking for.

If you can, think about all of this and create your strategy before you actually need the loan. It will make things go better and faster when the time comes.