Look up “business finance” on the internet and you will find Commercial Loan Brokers (CLB’s) all offering the same thing, a one stop solution for every kind of business financing need. Offers include quick fundings with low rates requiring very little information which is impossible. The temptation to click is too great for those in a hurry and unaware of their options.
Anyone can call themselves a CLB and say whatever they like to generate that click. Clicks are often sold and then resold to the highest bidder. Offers are extended and often accepted on a how much and how fast basis? To me it’s like getting married to someone from a dating site without ever meeting, it’s a very bad idea.
Business Finance Guides (BFG’s) do not make promises or give advice without knowing the answers to key questions. Only then can they determine all the options and the best approach. Knowledge and experience need to be shared so the borrower is able to make the best decision and improve their chances of long-term success.
CLB’s are often allowed to add their own fee on top of the one they normally earn. This is paid directly from the proceeds of the loan and substantially increases the overall cost of financing. Seldom do these kinds of loans fully solve the problem it was intended, and renewals are very common.
BFG’s are also paid by the lenders but as a percentage of the fees earned and it does not come from the pocket of the borrower. Good lenders are keen to work with properly prepared applicants which fit their lending parameters. BFG’s can save both lenders and borrowers a lot of time, money and frustration.
It is hard to tell a CLB from a BFG just by a website and business owners are advised to look for experience, demand a conversation and ask lots of questions before making an application. Five to ten working days is the minimum time frame needed to fund an alternative loan and only a CLB will promise it faster than that. Working with a BFG is the best approach.