The Process of Commercial Lending
The process of commercial lending can be very exhausting and sometimes hard to understand especially if you are not familiar with all of the requirements that are needed and other specifications that go into getting a commercial loan for your company, explains Carlos Hank Rhon. With a little bit of knowledge on the subject of commercial lending however, you do not have to go into the process blinded by a lot of terminology and hidden clauses. Applying for a commercial loan is in fact, not very different from applying for a personal loan. And once you understand what all goes into the commercial lending process, you will be more inclined to look into taking out a commercial loan for your business yourself.
The first step in the commercial lending process is to get pre-qualified for your loan. Lenders like Carlos Hank Rhon will do this by looking over your financial history and evaluating your current budget to see if you would be able to afford paying back the loan that you requested. There are several other factors that a commercial lender will take into consideration including any existing debt that you currently owe on and what the main purpose of your loan is. Once all of the details have been given and the pre-qualifying portion of the commercial lending process has been completed, it is then time to fill out the loan application papers.
There is a lot of paperwork and documentation that goes along with applying for a commercial loan. So the sooner you get started with your commercial loan application process, the better off you will be in terms of getting your loan completed and approved as quickly as possible. If you are applying for a commercial loan in order to fund a brand new business, you may need to provide the lender with additional documentation stating your plans for your new business as well as tax return information for the past three years and any personal financial statements you may have on hand, says Carlos Hank Rhon. These are just a few of the documents that commercial lenders may need to have in order to process your loan application. Your lender will let you know of any additional forms or papers they will need in order to submit your application.
Once you have completed your application, your commercial lender will then go over your credit history as well as discuss any collateral that may be used in order to help increase the amount of your loan or further your chances of getting the loan that your require. Some things that you may be able to use for collateral purposes include personal real estate and stocks and bonds that you may own. After all of the forms have been signed, considered and approved by your lender, the loan application is then sent on to the loan underwriter or the loan committee in order for them to make a final decision. It is their job to either approve or deny your loan based on all of the information and facts that you provided to your lender.
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