Your Texas Commercial Loans was approved, you signed the dotted line and now you are entering repayment. It’s just that simple, right? No. Many lenders require much more from their borrowers.
Obviously, it is your main responsibility as the borrower of a Texas Commercial Loans to uphold your financial responsibility by paying back your loan according to the terms that were agreed upon at signing. Whether this is a long term or short-term loan, that remains a constant. But what many borrowers do not realize is that with many lending institutions, this is not the only requirement that is ongoing.
Borrowers are prepared for the application process by getting all of their financial documents in line. This has to be done before the loan is even processed. But what many small business owners don’t realize is that many lenders require an ongoing sharing of financial information to assess the progress of their loan.
This is where it is essentially for you to be very clear on what your lender is going to require of you after the loan is dispersed. Some lenders require annual statements (balance sheets and tax returns), while other require the borrower to check in with an income statement on a monthly basis. In many cases, failure to provide the documentation that is required in a timely manner will put your Texas Commercial Loans (and property) at risk.
In addition to reporting requirements, some lenders require borrowers to meet certain benchmarks to maintain good status. These conditions of your Texas Commercial Loans will be disclosed at the time of approval. They will not be sprung on you after the fact. Often times this means being able to maintain a certain level of cash flow and not taking on much new debt. This will require you to watch your operating budget very carefully from month to month. It might even require changing some of your day to day operations to meet the financial requirements. You might also need approval for any other debt-incurring expenses that would affect your debt to cash flow ratio.
The good news is that you will know all of this ahead of time, but you must recognize, that when it comes to your loan, these are not optional portions. They are just as serious as your monthly payments. You must keep this in mind when deciding upon a loan, especially if you are in an industry that has periods of stagnation.
So what happens if I am able to make my payments, but cannot meet the other conditions of my Texas Commercial Loans?
The first thing that you should do is to make sure that you have a good CPA. This will alleviate much of the work load and stress. Then you are not attempting to keep up with all of it by yourself. Sure, it will cost you, but a good CPA is going to pay for themselves many times over. Second, talk to your Texas Commercial Loans lender and tell them your plan to get back on track. You cannot afford to ignore this problem, as there is a lot of money and assets undoubtedly riding on its success.
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.
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