Alternative Solutions for Business Loan and Commercial Mortgage Situations
by Stephen A. Bush
Commercial borrowers need to realize that they have more commercial loan options than they think. These business financing options are referred to here as "Business Loans Without Banks" because most commercial borrowers believe that a bank is the best source for a commercial loan. Non-traditional business lenders are commonly considered to have the competitive edge for a variety of business financing situations.
In some cases a traditional bank will offer to provide a business loan but will attach excessively stringent terms and covenants. In other cases a traditional bank will decline the commercial mortgage outright, perhaps because they do not even provide business financing to the commercial borrower's particular industry. In either case, the commercial borrower is likely to benefit by considering and using "Business Loans Without Banks".
Some business loan borrowers are likely to feel that a traditional bank is their best source for a commercial mortgage. However, because most traditional banks focus on a small number of established industries, non-traditional (non-bank) and non-local commercial lenders should be considered for most business financing situations. Therefore the recommended commercial loan strategy (as discussed in this article) is "Business Loans Without Banks".
As I reported in a previous business loan discussion, in many commercial mortgage situations it is common for a local bank to assess stricter commercial loan conditions than would typically be seen in a competitive business financing scenario. Such banks can often take advantage if there are few business lenders in their market.
An appropriate response by commercial borrowers is to seek out non-bank business loan options. It is neither necessary nor wise for commercial borrowers to depend only upon local traditional banks for business financing solutions. For most commercial mortgage situations, a non-local and non-bank commercial lender is likely to provide improved commercial loan terms because they are accustomed to competing aggressively with other commercial lenders.
There are at least three commercial loan situations in which business borrowers will typically experience that non-traditional lending sources can provide conditions that are best for the borrower: (1) commercial mortgage loan programs; (2) credit card factoring programs; and (3) working capital management programs for credit card processing.
Business Financing Programs - Commercial Mortgage Alternatives
Two of the most prevalent commercial real estate loan obstacles can be precluded with a "Business Loans Without Banks" mentality by businesses. The first commercial mortgage obstacle is the common practice of most banks to decline business financing for special purpose commercial properties such as churches and golf courses.
The second business financing situation is the typical practice of most commercial banks to attach balloon and/or recall provisions to their commercial mortgage loans (which means that the bank can require early repayment of the commercial loan under various conditions). Both of these undesirable business loan situations can usually and easily be avoided by considering a non-traditional and non-bank lender.
Working Capital Business Loan and Business Cash Advance Programs - Business Financing Alternatives
Business owners that accept credit cards will frequently qualify for a working capital business loan via credit card financing. Traditional lenders will often be very poor candidates to consider if a business needs help with a business cash advance.
Because even thriving businesses frequently need more cash than they can borrow from a bank, it can be of critical importance for a business to use "Business Loans Without Banks" and locate non-traditional lenders to assist with this business financing need.
Commercial Loan Alternatives - Programs for Credit Card Processing Management
The choice of an appropriate credit card processing service can be instrumental in improving the profitability of businesses with a high volume of credit card activity. The analysis of credit card processing providers can be effectively combined with the credit card factoring and credit card receivables process described above.
In coordinating a business cash advance and working capital business loan program, it is usually possible to achieve improvements in the business owner's credit card processing services. Traditional banks are usually not competitive in providing assistance with a business cash advance using credit card receivables. So it is likely that a non-traditional lender will be the major source of competitive help with credit card processing improvements.
A closing commercial financing comment: I have published a previous commercial loan report about business lenders to avoid. I want to emphasize that there are traditional and non-bank lenders which should be circumvented. So when commercial borrowers evaluate "Business Loans Without Banks", it is still of critical importance that they are prepared to avoid a wide variety of problematic non-traditional commercial lenders in their search for viable business financing, especially when it involves business cash advance (credit card receivables and credit card factoring) programs, credit card processing services and commercial real estate financing.
Copyright 1995-2008 AEX Commercial Financing Group and Stephen Bush.
All Rights Reserved.
Contact Information
Stephen Bush
Chief Executive Officer
Phone: (937) 780-4030
bush@aexllc.com
PO Box 353, Leesburg OH 45135-0353 USA