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Author:
Bev Dodd
Web Site: http://www.family-refinance-consolidation-loans.com
Commercial
loan: Get to know your lender
Whether
your company is a high-tech Internet start-up or an established
manufacturer, a commercial loan is sometimes necessary to propel
your business to the next stage of growth. Carefully evaluate
your needs and purpose for a commercial loan. We'll discuss this
more below.
Before
you talk to the bank about your commercial loan, consult your
accountant to help prepare projected cash flows to determine
your estimated future revenues. Never tell a lender that you
want to borrow as much money as possible. Rather, you should
have a specific amount in mind and the paperwork to show why you
need it and how you will pay it back. Realize that you or your
company will be required to finance a portion of the project
costs.
Make
sure that you request enough money to complete the planned task
with your commercial loan. While you don't want to borrow too
much money (extra cost of interest) it doesn't do any good to
borrow $30, 000 to buy a $50, 000 piece of equipment if you
don't have other resources to make up the difference. This may
sound simple but it is particularly difficult when you are
providing funding for operational activities that are likely to
be variable in costs.
Get
to know your bank before applying for a commercial loan. Your
bank loan officer makes money by lending money. They know that a
healthy, growing small business may take out several commercial
loans in the future and be a solid merchant customer as well.
They also know that small businesses don't always stay small.
The lender also may be under increased pressure to build loan
volume as banks continue to consolidate. Supply the lender the
proper documentation for your commercial loan, that way they can
make an informed decision.
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