|
Commercial Mortgage And Working Capital Business Loan Choices |
By:
Stephen A. Bush |
|
|
Commercial Mortgage and Working Capital Business Loan Choices
by Stephen A. Bush
Commercial borrowers need to realize that they have more commercial loan options than they think. These business financing options are referred to here as "Thinking Outside the Bank" because most commercial borrowers believe that a bank is the best source for a commercial loan. Non-traditional business lenders are commonly considered to have the competitive edge for a variety of business financing situations.
Here are two brief examples about how a commercial borrower is likely to benefit by "Thinking Outside the Bank". In many situations a traditional bank will provide a commercial mortgage but will include non-competitive covenants and terms. In other cases a traditional bank will decline the business loan because they do not provide commercial financing to the commercial borrower's particular type of business.
Commercial loan borrowers might feel that a bank is their most likely source for business financing. However, since traditional banks usually focus on a few types of businesses, non-traditional business lenders should be emphasized for any business loan situation. Therefore the recommended commercial mortgage strategy discussed in this article is to "Think Outside the Bank".
As I noted in an earlier commercial mortgage article, in many non-competitive business loan situations it is not unusual for a local traditional bank to impose harsher business financing terms than would commonly be seen in a more competitive commercial loan market. Such traditional banks routinely take advantage of a relative lack of other commercial lenders in their local market.
An effective response by borrowers is to emphasize business financing options other than the traditional ones. It is not wise for business borrowers to depend only upon local banks for commercial loan possibilities. For common commercial financing circumstances, a non-local business lender can frequently provide the best business loan terms because of competition with other business lenders.
There are at least three commercial loan situations in which business borrowers will typically experience that non-traditional lending sources can provide conditions that are best for the borrower: (1) commercial mortgage loan programs; (2) credit card factoring programs; and (3) working capital management programs for credit card processing.
Business Loan Options - Commercial Mortgage Loan Programs
Two of the worst commercial real estate financing problems for business owners can be eliminated by "Thinking Outside the Bank". The first commercial mortgage business loan problem is the typical bank practice to eliminate most special purpose business properties (such as golf courses and funeral homes) from their lending portfolio.
The second business financing situation is the typical practice of most commercial banks to attach balloon and/or recall provisions to their commercial mortgage loans (which means that the bank can require early repayment of the commercial loan under various conditions). Both of these undesirable business loan situations can usually and easily be avoided by considering a non-traditional and non-bank lender.
Business Loan Options - Business Cash Advance Programs
Most businesses that accept credit cards will qualify for a business cash advance with their credit card receivables. Traditional banks will typically be very poor candidates to consider if a business needs assistance with credit card factoring and business cash advances.
Because even thriving businesses frequently need more cash than they can borrow from a bank, it can be of critical importance for a business to "Think Outside the Bank" and locate non-traditional lenders to assist with this business financing need.
Business Loan Options - Credit Card Processing Programs
The selection of a credit card processing service can be critical in improving the cash flow of a business with significant credit card activity. Credit card processing providers can be combined with the credit card financing process mentioned earlier.
In managing a merchant cash advance program, it is often possible to obtain a significant improvement in credit card processing activities. It is probable that a non-traditional lender will be the key source of effective help with credit card processing because traditional banks are usually not competitive in providing assistance with credit card financing.
A closing business financing thought: I have written an earlier business loan article about commercial lenders to avoid. It should be noted that there are in fact both traditional and non-traditional (non-bank) lenders which should be avoided.
So when commercial borrowers "Think Outside the Bank", it is still of critical importance that they are prepared to avoid a wide variety of problematic non-traditional commercial lenders in their search for viable business financing, especially when it involves business cash advance (credit card receivables and credit card factoring) programs, credit card processing services and commercial real estate financing.
Copyright 2005-2007 AEX Commercial Financing Group, LLC. All Rights Reserved.
About Steve Bush: Steve provides business loan and credit card processing advice. Free Church Loan - Commercial Loan reports from AEX This and other unique content 'business loan' articles are available with free reprint rights.
|
|
Article Source: http://www.statssheet.com/articles/article53952.html |
|
|
|
|
|
