Applying for commercial finance does not need to be difficult but you do need to give some thought to the questions you are likely to be asked.
Whether you are discussing your application with a broker, or directly with a lender it is important to make the best impression possible. If you can give a credible, accurate picture of your circumstances and your project you will stand a good chance of success.
Applying for Commercial Finance – Five Golden Rules.
- Be honest. If you have a poor credit history say so. Brokers and lenders will always try to find the best deal – you will just end up wasting your time if don’t say right away that you have credit problems. Having a bad credit record does not mean that you can not get finance, just means that your broker will have to ask the right lenders.
- Be realistic about property values, and your ability to raise the deposit.
- If you are a trading business have your basic figures ready. It’s OK to take a guess, but remember that if you say that your business is operating on a 25% net profit your accountant will have to back you up.
- Be ready to discuss your personal finances and those of your business partners, don’t be shy.
- Ask questions. If there is anything you are not sure about don’t be afraid to ask.
If you are planning to apply directly to a lender yourself then start at the top of the food chain. The high street banks offer the best rates and are the pickiest.
If you get turned down by one of the big four the chances are that you will also be rejected by the others. If that happens then it’s probably best to start using a broker.