Tips to Secure Commercial Lending

Commercial lending is a much different landscape than consumer lending. Knowing a few tips about the lenders and the process can greatly improve your chances of getting a loan.

Appling for commercial lending is a long and often arduous process. The dollar amounts involved are rather substantial and that makes the approval criteria and process much more challenging. Lenders are interested in finding borrowers who will successfully repay their loan and the interest associated with it so that they are making their money. Understanding the lenders point of view and working toward that goal with them can make your loan application process much less stressful and difficult.

It is never a bad idea to keep your options open. Having a rapport with a few lenders is always a great plan. Investing the time to meet with lenders, understand their criteria for lending and just chatting with them about your potential needs will lay the ground work for the day that you do submit a loan application.

It is also wise to think of the lenders that you have relationships with as you would any other vendor. In this case the vendor is supplying you with money but that is after all what a service provider does. It is not dishonest or disrespectful to speak to several lenders for the same loan. You are shopping for the best deal and that is simply smart business.

The only way that you can make a mistake when creating commercial lending relationships is if you are not completely honest with the lenders. You are wasting your time if you are not honest in the information that you are providing about your business and yourself. The information and advice that you are getting will be tailored to the information that you give the lender. And if that information is false then most likely they will not be providing you will accurate or useful tips, information or processes.

Make the Right Impression

Commercial lending is a numbers game and the best credit score and credit history will get you the lowest interest rate. But there can also be a little grey area. This is where the lenders opinion of you and your business comes into play. You want to be honest but also paint the most impressive picture that you can when telling your story. Promote your strengths and successes as well as your goals and how you plan to attain them. Another way to impress a lender is to submit a completed loan application package that looks professionally prepared. Be certain that all of the needed documentation is included and that the format is easy to understand and follow.

Focus on Collaboration

Both you and your lender have a great impact on the outcome of your loan application. By investing your time and effort in the process and application preparation you can greatly improve the outcome. Honesty and professionalism will get the attention of your lender and could be that small difference that convinces your lender to approve your loan application.

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Commercial Lending in This Economy

Commercial lending practices change with the economy, markets, and rising or falling risk factors. The end of 2017 is seeing historical challenges from regulations as well as emerging risks.

Interest rates have been at historically low numbers for some time even with the Federal Government raising the rates twice in 2017. Moderate job gains and economic activity were noted as the reasons that the interest rates will undoubtedly continue to their third forecasted hike for 2017. This hike in the central bank’s federal funds rate is expected to raise the interest rates of home equity lines of credit as well as credit cards. According to The Risk Management Association, “Rising interest rates on floating rate loans may negatively impact borrower cash flow and result in lower debt service coverages.” This will encourage commercial lending institutions to take a close look at invested equity in order to secure their loans.

Retail issues have been at the forefront of commercial lending concerns for the last two years as more brick and mortar retail stores are shutting their doors in the wake of e-commerce’s takeover. Multi-use projects are taking over the “shopping mall” segment as newer generations place a strong demand on living, working and playing “under one roof.” These multi-use projects have entertainment venues, restaurants, shops, office space, residential units, grocery stores, gyms and even storage spaces. Atlanta developers recently took on a multi-use project next to the Braves new ballpark. It consists of 41-acres with three luxury apartment buildings, entertainment venues, retail and offices and, including the ballpark, came in at $700 million to complete. Of course, it’s still not complete, but is expected to undergo the finishing touches by the beginning of winter.

Regulatory concerns have been raised regarding commercial lending institutions with high commercial real estate loan concentrations. Because of this, underwriting standards have been scrutinized and will reveal this in tightening of their lending belt. Surprisingly, one of the worst performing commercial real estate sectors is construction loans, which has led to a reduction in this sector in bank’s loan portfolios. Multi-family is starting to see some saturation in larger markets while single-family homes are proving to be in high demand, particularly those in the mid-price range. Banks will eventually adjust their lending strategies to reveal these market changes.

Alternative Lenders

With traditional lenders tightening their underwriting standards for various segments of commercial real estate, alternative lenders have become increasingly important to those in these sectors. Contractors, developers and business owners are reaching out to non-traditional lenders with one of these being private hard money lenders. A private hard money lender is not bound by the same FDIC and government regulations and can lend according to their specialized investment portfolios. Because they are asset-based, they do not require impeccable credit scores.

At Level 4 Funding we provide private hard money loans for all sectors of commercial lending including construction, office, retail, small business, industrial, multifamily and multi-use.

Because we work with private hard money lenders, we can approve loans in as little as 24 hours and fund in less than a week. We may very well be able to fund your project when other institutions have rejected your request.

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Commercial Lending

At it’s very core, a commercial loan is a business arrangement that is used to fund major purchases or improvements, typically in the real estate sector. Commercial lending specializes in large project that businesses or individuals could not afford to handle financially on their own.

While there are a variety reasons for a borrower to seek out funding through commercial lending, they all have one thing in common. These loans exist to help businesses, whether in real estate or any other field, bridge the gap between operational expenses and increased profit potential. Many small business owners have effectively used this source of funding to leverage their businesses into another level of productivity and profit.

There is a certain level of risk that is associated with commercial lending, on behalf of both the lender and the borrower. With the loan amounts being very large, there is always the potential for some sort of unforeseen circumstance to scramble the best laid plans of even the most qualified lenders. There are many factors that might have an impact on the success of a commercial venture, especially in real estate. Natural disasters, the overall state of the economy and political fallout are all large influences in the success of businesses and all of them are outside of the control of either the borrower or the lender. However, there are ways to minimize the risk so that both lenders and borrowers can steer clear of catastrophe.

Obtaining a loan through commercial lending can be a very time consuming and extensive process. This is very much on purpose, on behalf of the lenders. After all, they are going to be giving the borrower a substantial amount of money and they will need to make sure that their investment is a good one. For traditional loans, the creditworthiness of the borrower is critical. This will immediately let lenders know whether or not the borrower is a risk. If the borrower is determined to be a risk, this does not necessarily mean that they will not be able to obtain funding, but if they do, it will be at a higher interest rate and will most likely have additional requirements. In addition to this, the business that is applying for the funding will have to provide a substantial amount of financial documentation to establish the health of the business. This will most likely include balance sheets, bank statements and tax returns. Depending on the lender, the primary business owner might also have to provide this information about their personal finances.

Are borrowers able to obtain loans through commercial lending multiple times?

Each loan is considered a separate process and procedure, so it is likely that a small business will consistently have a loan floating on their books. However, each loan takes into account the borrowers credit, so multiple inquiries have the potential to hinder further efforts. It is also possible for borrower to renew their loan. Depending on the commercial lending agency, the borrower may be able to roll their loan into a new option for financing. Usually this will offer better interest rates and terms, as the borrower will have established themselves as a lower risk with the lending institution. Assuming, of course, that the borrower responsibly handled the first loan.

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Commercial Lending In Texas – Do I Need A Commercial Broker?

You have decided that you want to take advantage of some of the unique potential of the commercial lending market in Texas, but you are unsure of how to proceed. Maybe you like to do things for yourself and make it a learning process, or maybe you simply don’t have the time to do it yourself. If so, then you need to decide if it is in your best interest to hire a commercial broker.

Deciding whether or not to utilize a mortgage broker is a big decision and one that is entirely up to you as an individual and as a business owner. It is quite possible that a broker could make your commercial lending experience very easy, but there is also a chance that using one could cost you a significant amount of money.

When deciding whether you need a commercial broker or not, there are several things to consider. First, is the amount of time that you are willing to spend hunting down your own lenders. If this is a project that you would like to devote many hours to, on the phone and in person, speaking with lenders and setting up appointments, then using a commercial broker will not save you time. Maybe you even like this part of the process and do not mind spending the time to do it. However, if you do not want to spend the time to shop around to different banks and lending sources to track down the perfect commercial lending program for your needs, then hiring a commercial broker might be an excellent investment for you because of the time that you are bound to save.

Another deciding in factor is whether or not you are familiar with the commercial loan process in general. If this is your first time, it might not be a bad idea to get a recommendation from a colleague or mentor and work with a commercial broker. They will know much more than you do at this point. However, if you are experienced in this, and have a good handle on the process, then perhaps you don’t need one. If you have done many investments, then you might even have some preferred lenders to cut through some of the leg work.

If you have a unique situation, whether it be for qualifying, for the terms of the loan, or for something else, it also might be in your best interest to work with a commercial broker. Lenders want to get as many qualified loans out as possible and might not take the time necessary to hear your specific situation, unless you have a professional to advocate for you. Whether you decide to use a commercial broker or not is a decision only you can make, but there are many benefits to securing commercial lending in this manner.

What if I tried commercial lending in the past, but was not happy with the outcome?

If that is the case, that it is probably very important that you work with a broker if you are looking for another commercial loan. They will be able to find lenders to compare for you and you will have more choices than you did before. If you didn’t have a good experience the first time and you would like to try again, having a commercial broker as your advocate could drastically change your experience in commercial lending.

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Commercial Lending In Texas – What Can I Expect From A Commercial Broker?

Entering into a commercial real estate venture can be an intimidating decision. Whether you are looking to purchase your first property or are simply trying to scale up from what you already have, going at it alone might seem like a noble challenge, but with so much money on the line, it is often wise to seek the help of a broker in commercial lending.

The market of funding sources for property investors has been expanding and it will continue to do so as new and creative ways of funding commercial mortgages keep emerging for small business owners. As an individual, it can be a huge work load to try to stay on top of all of these various options, while still maintaining a small business. This is where a commercial broker could be of tremendous help to a potential borrower. This is not to say that a borrower should not spend a great deal of time learning what they can, it is a lot of money, but brokers know the commercial lending landscape better than anyone, especially in local markets like the one emerging in Texas.

So what exactly does a commercial broker do and what can a lender expect out of one? Essentially, a good commercial broker will have lots of experience in a large variety commercial lending options. This can be any property from a strip mall, to an office building to a multifamily housing unit, although each individual broker will most likely have an area of specialty.

A huge benefit of working with a commercial broker is that they have connections with a variety of lenders. This gives them a great deal of flexibility when searching for the best possible loan for a borrower. While some brokers only specialize in certain regions, this can actually be a benefit, as they will be able to guide a potential borrower to very specific lenders for very specific properties.

Typically, a commercial broker will take a borrower through the entire process of securing commercial lending. Sometimes this might mean that they even assist a borrower after the loan has been approved, if there are additional requirements. A broker will review a borrower’s financial needs and qualifications and then being “shopping” for a potential lender. Brokers will also help with finding appraisers for the property. However, one of the greatest aspects of working with a broker is that when all of the appraising and paperwork is done, they will present the borrower with a list of options to choose from. Compiling such a list as a small business owner going at it on their own would take an extensive amount of time and would most likely be incomplete, as a borrower is not going to have the same type of relationship with lenders as the broker. The borrower then simply chooses which option is best and the process moves forward.

How are commercial brokers paid on commercial lending in Texas?

Typically, brokers are paid from a percentage of the final loan amount. This can be anywhere from 1% to 5%, traditionally. While some brokers have an upfront fee, many do not, which is very beneficial for borrowers. Brokers also usually depend on referrals, rather than active recruitment, so it is in their best interest to do everything that they can to help you secure the best commercial lending option possible for a borrower.

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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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

The ABCs of Working with a Commercial Lender

As you navigate the budget and necessary finances for keeping up with your business expenses, you may decide you need a loan. Working with a commercial lender can help ensure you get the best loan, and terms, for your business.

There is no reason to be hesitant to work with a commercial lender because there are many reasons they can benefit your loan process, versus hinder it. Quite frankly, they can save you time and money. While yes, you do have to pay a fee to a broker for their professional services, there expertise is well worth the minor expense, and using a lender will save you the hassle and frustration of trying to obtain a loan on your own if you are not familiar with the process.

Working with a lender has many benefits. Using a commercial lender allows you to refocus your time, energy and efforts back where they belong — on your business. If you are too busy trying to figure out how to get a commercial business loan on your own, you may be distracted from the important tasks of managing your business, getting out and meeting new clients, and branching out into new markets. Using a lender allows you to be where you are supposed to be – building your business.

Along with saving you time and hassle working with a lender can save you money – most small business owners would agree that money is something they have little of to waste, so why would you want to waste money trying to obtain a loan on your own, when it’s a lender’s area of expertise to find you the lowest interest rates, fees and other costs that are associated with a loan. They can also serve as a trusted advisor if you have questions about finding an appraiser, a lawyer to look over your loan documents and the like. Having a lender you trust is an invaluable asset to getting the best loan for your business.

Finding the right commercial lender is easier than you think.

Asking other business owners, doing some research online and actually meeting with lenders to see if you get a good feeling about their services are all good ways to find the right lender for you and your business needs. Don't sell yourself short when meeting with lenders. Ultimately, this is your choice and you will be working on a complex transaction with this lender so you should form a good working relationship.

Don’t waste time with a lender who is not willing to work in your best interest.

Working with a lender should result in a win-win situation. You should feel confident that the lender you are working with is going to get you the best loan. They should have expertise in your specific loan type, as well as your business’s industry. They should also be able to give you references if you request them. Customer service is another indicator if you’ve found the right lender – answering your calls and emails, in a timely, professional and courteous manner is important too.

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

What Commercial Hard Money Lenders Want You To Know

Hard Money has gotten a bad reputation amongst commercial lending circles due to the fact that they have lower standards and higher default rates. Yet, for borrowers who do not have the time for a lengthy loan process or might have had damage to their credit, these loans and commercial hard money lenders offer an opportunity to increase their revenue stream through commercial properties.

One of the nice things about hard money loans is that they are very flexible in the type of property that they can be applied for. This means that they are often the go to loan for virtually any purchase or project, if the borrower is looking for a quick turn around and can plan for an influx of cash flow with the loan to propel them forward. Commercial hard money lenders are always looking for opportunities to capitalize on excellent real estate properties.

Now that being said, there is actually one type of property that hard money cannot be used for: residential properties that are occupied by the owner. The reason for this is that there are many more regulations surrounding such a transaction and the added complication is not worth it to commercial hard money lenders.

When, then, are hard money loans a good option over traditional channels? One type of property that is a great suit for a hard money loan is a property that the borrower is intending to quickly fix up and turn around to sell. In this type of scenario, a hard money loan is excellent because the property will be improved and sold before the balloon payment of the loan becomes due. By doing this effectively, the borrower is essentially turning a profit with someone else’s money. Granted, the borrower will be paying the interest on the loan, but that will be minimal compared to the profit potential. There is inherent risk in this type of a venture, however, as there is no guarantee of a sale. To minimize their risk in these cases, commercial hard money lenders will use the property itself as security and will often occupy the first lien slot in case of default.

One of the greatest strengths of hard money loans is the speed at which they can be acquired. While a traditional lender can take a up to 6 weeks to get a loan funded (or longer, in some cases), a hard money loan happens in a matter of days. For projects that are time sensitive, this is a huge advantage, especially if the property that the borrower is pursuing has multiple bidders who are interested.

What is one thing that commercial hard money lenders wished that borrowers knew?

The one thing that many borrowers do not seem to understand about hard money loans is that the biggest factor determining the amount of the loan and the terms that will be offered is the property. Both the value of the property and the amount of equity that the borrower will have invested in it. Second to this is the plan for how the loan will be used for the property. If a borrower can show a solid plan for how they will increase revenue stream (and a lender hears this as being easily able to pay back the loan), it will be much easier to get approved. Commercial hard money lenders can be an excellent option for savvy real estate investors.

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

How the Consumer Financial Protection Bureau Impacts Commercial Lenders

Over the past couple of years, the power of the Consumer Financial Protection Bureau (CFPB) has continued to grow. While it remains to be seen what impact the current administration will have on the CFPB, it would be wise for commercial lenders to pay attention to way the lending industry is being changed.

With the Dodd-Frank Act, the commercial lending industry has been scrambling to ensure that institutions fall within the guidelines of the law. While this is not a bad thing for consumers, it does make the industry much more regimented. This, ultimately, has the potential of damaging growth over the long run. Because of Dodd-Frank, commercial lenders will be at the mercy of the CFPB not in both current and future activities. But what exactly does this mean for both lenders and borrowers?

One of the major changes that will affect both lenders and borrowers with these regulations is in data collection. This might not seem like a burden, especially on the borrowers, but the data collection infrastructure that is going to be built in the industry surrounding this need has the potential of costing borrowers on the back end. Commercial lenders are now required to gather demographic information that will identify borrowers as women, minorities, veterans, and other ethnicities. This information will be compiled about the principal business owner.

However, the stipulation is that this information cannot be shared with underwriters or anyone else who might be able to halt the lending process because of discriminatory demographic information. That is, unless they share a non-discrimination clause with a potential lender. The necessary steps that will need to be taken by commercial lenders to gather this information, but then not share it remain to be seen, but this will certainly impact the process in terms of cost and time that it will take to process the application.

The interesting thing about this regulation is that the CFPB has yet to divulge exactly how they plan to implement this regulation. This leaves the industry in limbo. Lenders cannot comply with or adapt to regulations that have yet to be implemented and so it is virtually impossible how this will impact lenders and borrowers in a specific way. The strange reality of pending regulations is that they actually might be changed before they are ever implemented.

What are the future of the regulations that will affect commercial lenders?

While it is very hard to tell exactly what will come from the government, there does seem to be a trend toward tighter regulations on the commercial lending market. Part of this is motivation to protect consumers after the last real estate collapse and part is a general trend toward a regulated lending market across the landscape, as many predatory loans have poisoned the waters. Commercial lenders will have to deal with an ever-changing landscape of pending and enforced regulations. And you can be sure that it will ultimately end up affecting borrowers as well.

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Finding A Commercial Lender When Banks Won’t Do

In a contracting real estate market, it might be very difficult for potential borrowers to find banks that are willing to fund their endeavors. But potential borrowers can still find a commercial lender in an economically challenging time.

Traditional lenders are nervous about the current trends in the real estate markets. After the economic collapse 10 years ago, the market was relatively quick to rebound, at least in the area of commercial real estate. This expansion has also had the consequence of scaring banks and other lenders. They are worried about a lack of return of investment that tumbling property values inevitably brings.

In short, they are worried that an economic downturn is going to cost them like it did the last time around. The result of this is that a traditional commercial lender will raise the bar for dispensing loans, making it much more difficult, and much more costly, to acquire. As the market becomes more scarce, a lender is more likely to require increasing amounts of collateral or security before granting a borrower a loan.

But how does this affect borrowers who still need to find a commercial lender in spite of the many hurdles? Well, first, as a borrower, you should be prepared to not only work hard, but also to get creative in your search for financing. You might have to look for lenders in places that you had never thought of before.

One place that you might consider pursuing financing is a small, local bank. Not only will they be willing to work with you in a more personal way, but they are often looking for investment opportunities in the local community. It helps both of you if you can say that your commercial lender is someone down the street. This is especially true if you are an account holder there already.

Another strategy would be to consider pulling your accounts from a larger bank, if they have turned you down for a loan. While this might seem slightly underhanded, if you have a significant portion of your assets wrapped up in the bank, they are not going to want to see that revenue stream walk out the door and might make an attempt at trying again with your loan. Be polite about this tactic, but be firm.

What if I continue to receive denials from every commercial lender to whom I apply?

The worst thing that you can do is to give up. Keep at it. Keep trying. You have already done the hard part by assembling all of the paperwork, getting your assets in line and making sure that your accounting team left nothing out. The hard part is done. So plan on applying to different lenders constantly. Even if it takes 100 different applications to 100 different lenders, it will eventually work out. Do not get discouraged and keep pursuing your commercial real estate dreams. In the long run, finding a commercial lender will be well worth it.

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage