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7 Insider Secrets Commercial Business Loans

Insider Secrets Commercial Business Loans

7 Insider Secrets Commercial Business Loans

Are you looking for insider secrets to commercial loans for your small business? Do you want to get approved fast with low-interest rates?

Small businesses often need help finding financing because banks are interested in something other than lending to small businesses. But if you have excellent personal and business credit history, you might qualify for a commercial loan from a bank.

But how do you go about finding these types of loans? And how do you make sure you get approved? In this article, you’ll discover insider secrets that the banks don’t want you to know. Find out how to get a commercial loan for your small businesses.

We’ll also reveal the top mistakes most small business owners make when applying for commercial loans. These mistakes will help you avoid making them yourself.

 

Commercial Business Loan Options Available Now

 

Are you looking for commercial loan options for your small business but need help figuring out where to turn?

Do you have an existing loan that you would like to refinance at a lower interest rate?

Are you afraid to ask potential lenders or the bank loan officer directly for money?

Have you tried applying for a commercial loan online only to be rejected?

Then you’re in luck!

Small businesses everywhere are facing financial challenges. And many are struggling to access traditional bank financing.

 

Business Loan Programs Available

 

That’s why there are now several alternative options available to qualified borrowers. These include:

  • SBA loan (Small Business Administration – SBA 7(a) loans)
  • Business credit card
  • Term loans through SBA 504 programs
  • Business lines of credit 
  • Private label/private placement loans
  • Lines of credit through banks and credit unions
  • Equipment Financing
  • Fixed asset financing
  • Term loan or other loans from alternative lenders

 

These are just a few examples of funding available to small businesses. 

Most small businesses fail before they reach five years old, and most entrepreneurs quit after two years. And most companies go bankrupt within three months of opening their doors. Yet, despite the odds, millions of people around the globe are building thriving businesses.

Why?

They understand the secret formula for getting a commercial business loan. These entrepreneurs know something that the big banks don’t want you to know. We know that accountants and business lawyers don’t know these secrets. All of these secrets are legal, and many of them work against common sense. Yet, they work.

These secrets are insider secrets because they come directly from the bank. These are the secrets bankers won’t tell their customers to protect themselves. Follow these insider secrets to build a thriving commercial business loan.

Follow them closely. 

Learn them well. Understand them thoroughly. 

Then apply them immediately. Then, watch your business grow. 

Watch it thrive, blossom, and flourish. 

See it grow into something finer and more substantial than you could imagine. Here’s what you need to know.

How to get a loan amount of $25,000, $50,000, or even up to $5,000,000 to fund your business with commercial business loans (even if you don’t have perfect credit)?

The biggest challenge any small business owner faces today is securing business financing to support their business. 

We will share with you the 7 Insider Secrets to securing commercial business loans to ensure your business has a long and prosperous life. 

Learn how to secure a commercial business loan fast – in 24 hours or less.

What is a Commercial Business Loan?

 

The commercial loan definition is an agreement between a company and a financial institution in which the company incurs debt to finance major capital expenditures or operating costs that the company would have trouble meeting on its own.”

Commercial lenders will often look at your business in a very conservative and traditional way. Most lenders require specific documentation before approving your business for a commercial loan, and knowing what is necessary regarding documentation is essential before undertaking the loan application process.

7 Insider Secrets to Securing Commercial Business Loans

 

Be prepared. Well, that’s not a secret, and it’s public information. However, we get asked by business owners daily who request a funding solution for their business and need to prepare to provide even the most basic information or documentation. 

 

SECRET #1

If there is one major secret we can provide to you as a lender is to stay organized. Make sure you keep copies of your business and personal tax returns. You will need at least the last three years. Do yourself a favor and start collecting this information now. The need for a loan application can come up at any time.

What if an opportunity pops up unexpectedly, good or bad? Are you prepared? You will also need personal financial statements, year-end financials, and other business documents. 

If you’re seeking financing options from a bank, you may need a well-thought-out business plan. As you can see, the commercial bank application process is not as easy as saying, “I need money.” 

Commercial Loan Checklist Requirements

 

Here are most banks’ and credit unions’ requirements for a business loan. The information that follows is an example of what banks typically request. Your bank or lending institution may or may not need these documents, and you must provide the business’s organizational documents.

These documents are usually the charter and the by-laws. Depending on the actual organizational structure, this might include partnership certificates or partnership agreements. 

If you have an LLC, it is the articles of organization, operating agreements, and or membership agreements. As mentioned, you also need the last three years of business tax returns.

Most banks also want to see your personal tax returns as well. You’ll also need a profit and loss statement and balance sheet for the last three years, and you will also need to include a current year-to-date P&L and balance sheet.

When does it matter if a company has been operating for less than three years? 

Sunwise Capital is an alternative lender that can assist businesses open for more than a year but less than three.

A current accounts receivable and accounts payable aging report is usually a requirement when applying for a business line of credit at a bank.

Make sure you can provide a detailed list of any equipment or machinery. Along with the list also means providing a depreciation schedule. Ensure you get your accountant or CPA to help you with many of these documents. 

 

SECRET #2

Are you using accounting software? If you answer “YES,” continue reading.

If your answer is “No,”

STOP – DO NOT APPLY WITH A BANK

Suppose you’re not able to gather all this information, no worries. Apply and be approved for a commercial loan with one of the best alternative lenders.

Financial information required 

 

You’ll need to provide a debt schedule, your A/R ( for accounts receivable financing), and A/P reports. 

Your report should include the following: 

  • All the details of each debt 
  • Providing the creditor or lender information
  • The original amount of the debt and the amount outstanding
  • Current inventory report (This report will need to be clear and concise and include all your pertinent stock and supplies. )

Once you pull this together, you will need a 2-year financial pro forma. This proforma financial statement is also known as a work-in-process report. 

The report provides for contracts not starting and those “in process.”

This report includes all the labor and overhead expenses, including raw materials. 

Lastly, you’ll need to provide personal financial statements and cash flow statements – for each partner that owns more than 20% of the company. 

That’s right. 

Every partner that owns 20% or more must provide these statements along with their tax returns for the past three years. 

 

SECRET #3 

Read “The 8 Questions You Must Ask To Get A Small Business Loan

Get approved within 24 hours without all the hassle.

How is your business growing and developing? What essential milestones is the company reaching, and how long is it taking to get there? All lenders consider the age of your business as one of the determining factors for loan approval.

Most traditional lending institutions like banks consider three years to be critical regarding survival rates. Most banks want your last three years of personal and business tax returns and compare that to alternative lenders who want a minimum of one year of continuous growth.

Making the Most of Your Business Loans Commercial

 

Just like laws of nature, there are specific indisputable facts regarding bank financing. The truth is that the more years of business operation, the easier it is for the bank to justify the approval. The same applies to your revenue.

One thing lenders do is see how you stack up against the averages. Commercial lenders will take the industry you are in and then compare similar businesses in your local area to yours in terms of time in business and revenue.

It is a well-known fact that banks do not like small businesses.

 

Just look at the headlines.

Why Banks Are No Longer Lending To Small Businesses

5 Main Reasons Banks Turn Down Small-Business Owners for Loans

Small Business Finance – Why Aren’t Banks Lending?

 

The common theme across all the headlines is that banks make less profit on smaller loans. Therefore, they are not motivated to originate these loans, and banks are in business to make money.

Are you surprised?

If 80% of all business loans are for less than $500K, then it’s easy to see why banks reject these loans in record numbers.

A bank’s cost to underwrite a $1M loan is the same as a $100,000 loan. So why not just focus on the much larger, higher-margin loans? That’s what they do. 

At Sunwise Capital, our average loan size is $75,000.

Although we do much more jumbo loans, our costs to underwrite are significantly less than traditional banks. As a result, we have much better economics, and issuing smaller loans is no problem.

We work with companies that generate anywhere from $150,000 annually to as much as $15M annually.

Our typical client makes around $750K, has been in business for seven years, and has a credit score above 650. You can easily see why we have a much better approval rate than banks.

We don’t have a 23-story headquarters with significant regional offices and multiple branches in every city. 

You don’t see us advertise on TV, nor do you see glossy print ads in all the magazines. 

We don’t have paper-pushing personnel that needs to justify their jobs by asking you for more and more information. You get the point.

 

Secret #4

Don’t Make This Silly Mistake with Your Commercial Business Loans

 

Every business looks to grow and expand. What happens when you stop growing? 

Ray Kroc, CEO of McDonald’s, famously said, “When you’re green, you’re growing, and when you’re ripe, you rot.” 

Does that make sense?

Businesses need a lot of capital to grow to their full potential. What happens if your business needs more money to improve? Companies must face the facts. 

Their growth becomes stunted if they do not receive a steady inflow of working capital either from self-generated cash flow, lenders, or outside investors. If they are not very careful, they may even die.

We all agree that businesses need access to capital to grow. Are you a business owner trying to go to that next level in your industry?

Are you trying to secure a business loan?

Commercial business loans are typical for large-scale purposes that range from buying new office equipment to purchasing real estate or an office building. Often the funding process can seem like a mountain to climb. 

For too many business owners, it’s almost inconceivable. And for many, the challenge is just knowing where to start.

If the loan application process seems like a vast minefield, the good news is that there are ways to navigate these landmines. Can you believe that bankers do not want you to know this information?

It shouldn’t be a surprise, but we will share the remaining 3 Secrets to secure a commercial loan to help your company grow and expand. Below are the remaining secret ways to secure a commercial loan for your small business.

 

Secret #5

 

Know Your Collateral Assets

 

I can’t stress this enough. You have assets that you can leverage to secure a loan, and the biggest asset you can readily leverage to obtain a loan is your REVENUE. These are simply the easiest and quickest loans to get. 

Period – the end!

This revenue-based loan looks at your past three months of revenue, and it then prorates this out over the next 12 months, and you can receive between 8% to as much as 20% of that amount with terms ranging from six months to 5 years. 

You can apply today, get approved by today, and fund today. 

It is that simple.

These loans are usually paid back daily, weekly or monthly, depending on various factors. These loans have no traditional personal guarantee, and that is why these business loans can be a bit more expensive. 

However, since approvals with credit scores of 500 or better are not unusual, what alternatives do you have available to you that are better than this?

It’s amazing how often a business owner comes to us and says something to the effect, “I want a long-term business loan with low-interest rates and monthly payments.” For those business owners who have good credit and are willing to sign a personal guarantee, fixed-rate loans as low as 5.49% with monthly payments for five years are available.

The crazy part is when the business owner tells us they do not want or will not sign anything with a PG.

Really?

Do you want a bank loan or a conventional loan equivalent? Let me ask you a serious question. Can you find a bank or lender anywhere in the United States that will lend you or your business money without a personal guarantee?

I didn’t think so.

Even the wise guy on the street corner wants a guarantee.

 

Secret #6

PUT UP OR SHUT UP

If you’re not willing to guarantee your business loan, why should we or anyone else offer you a loan? Think about it. Even our loans that don’t have a traditional personal guarantee still have performance guarantees.

This guarantee means (in non-legal terms) that you “agree” to remain in the business we’re lending to and that that company will continue to operate and repay the loan. Hesitate or pause, and I guarantee we will rethink our commitment to fund your loan. 

If the shoe is on the other foot, would you lend it to anyone without any assurances?

I didn’t think so.

I’ve told this story elsewhere on this site, and many people who know me personally know this as well. When I tried securing a business loan from a private lender, he asked me if I would assign my house to him if the business failed (that’s a personal guarantee if you didn’t follow).

Without hesitation, and I mean that seriously, there was not a fraction of a second hesitation, I said, “Yes.” 

I didn’t say, “Let me think about it.” 

Nor did I say, “Let me speak to my wife.”

Later the lender told me that it was because of my unbridled commitment and willingness immediately to guarantee the funds that he approved the loan personally.

Let that sink in for a minute. I did not hesitate at all and said, “YES!”

I’m going to let you in on a little secret. 

You must be willing to put a personal or performance guarantee on the business loan.

IF NOT, STOP RIGHT NOW; DO NOT PASS GO. DO NOT ASK FOR A LOAN

Common Complaints About Commercial Business Loans and Why They’re Bunk

 

Many of us in business know about the Uniform Commercial Code, or UCC (UCC-1), and how powerful it can be in helping you secure financing. 

You must understand that obtaining a large commercial loan is a powerful tool.

A UCC-1 financing statement is a legal tool to secure property. 

The “property” is for all collateral other than real estate and may include equipment or inventory. 

You are more likely to get a 100 percent financed commercial loan if you use the building or equipment as collateral for your loan.

The One Thing I Wish I Knew About Commercial Business Loans One Year Ago

When you apply for any commercial loan, your application will go through an underwriter. 

The underwriter must assess what type of property you will be getting for that commercial loan. 

Here are a few insider tips to help you get approved for that commercial loan from the underwriter. 

Lenders look at critical points with commercial business loans and ask fundamental questions such as:

  • Can you afford to repay the loan?
  • This term is called “Capacity.”
  • What are the quality and the value of the collateral?
  • What’s your credit score?
  • Are you creditworthy?
  • How much skin or personal investment do you have in your business?
  • Do you have any additional revenue sources to help with the repayment?
  • What else do you have for collateral or guarantees?

 

The underwriter will likely give you the green light for your commercial loan if you demonstrate your strength as a borrower. If there are apparent weaknesses, be prepared to address them with the lender adequately.

Remember, above all else, you must be consistent, and the story must make sense. 

 

BONUS SECRET

SECRET #7

Alternative Lenders: Expectations vs. Reality

 

It will help if you remember that you can borrow from alternative commercial lenders instead of a bank. These alternative lenders can be a specialized finance company or a group of private investors who want your business just as much as a typical bank but with friendlier terms. The application process may be faster and simpler.

Many traditional financial institutions require you to complete mounds of paperwork, and it is standard practice to ask you for the last three years of personal and business tax returns. 

Traditional lenders also expect a 720+ credit score and other capital guarantees, assets, or collateral.

This process is a nightmare, especially when you are running the day-to-day operations of your business. An alternative lender like Sunwise Capital can help you get a commercial loan without business plans, high credit scores, and tax returns.

At Sunwise Capital, we want to help you grow and expand your business. We look for long-term lending relationships. 

That’s why over 75% of our clients re-borrow from us 2 – 3 times a year. Some of our best clients re-borrow for two, three, or four years and borrow several million dollars. 

At Sunwise Capital, we have commercial lending rates that are very competitive to meet what you need regarding a commercial loan. Sunwise Capital offers to finance the following:

  • Acquisition of an existing business
  • Product launches
  • New marketing initiatives
  • Refinance of debt
  • Increase in working capital
  • E-commerce solutions and upgrading your website

 

Conclusion

 

In conclusion, if you’re looking for commercial loans for your small business, look no further than the experts at Sunwise Capital. We offer fast approvals, flexible terms, and competitive rates. And because we lend directly, we have access to over $1 billion in funding. So go ahead and apply today—we’d love to hear from you!

Small businesses use commercial loans that want to expand their operations. However, these loans are only available to some, so you’ll have to prove that you qualify. 

Fortunately, there are plenty of lenders out there who are willing to help you get the funding you need.

Qualifying for a commercial loan is vital for you as a business owner and will help take your company to the next level.

There are options for you as the business owner to secure this type of loan. These options are especially true if you are looking for an alternative lender that is friendly, has competitive interest rates, and has a fast and easy application process.

The key is finding a lender who understands your situation and has access to the correct type of loan program. That’s where we come in, and we specialize in helping companies like yours secure financing quickly and easily.

So whether you’re looking to purchase equipment, build a warehouse, or finance a new marketing campaign, let us know what you need, and we’ll get you the cash you need today.

CALL 888.456.9223 TODAY OR APPLY NOW

 

 

 

Mark Kane

Mark J. Kane is a successful entrepreneur and small business owner. He spent 17 years in the investment banking industry. As CEO of Sunwise Capital, he understands the challenges of building a business through equity, debt, and off-balance sheet financing.

Take Your Business Further With A Loan From Sunwise Capital