Commercial Finance Loans
Commercial Finance Loans – MONEY FOR YOUR BUSINESS
- Working capital
- Purchase of equipment
- Expansion or merger of business
- Consolidation of debts
- Accounts receivable
- Inventory
- Etc.
- Please bear in mind that our lenders are very interested in the feasibility of the loan, the capability of the borrower managing this business, the borrower’s credit worthiness and financial capacity to undertake such a business.
- The borrower must have some money into the deal and take some of the risk in order to obtain financing.
- The borrower should have a personal net worth of approximately the same amount as the loan request.
- Amount of Loan – It is very important for the borrower to specify the actual loan amount requested, rather than the maximum loan amount possible.
- Benefit of the Loan – The lender must have a clear understanding of how this loan will benefit the borrower, so the borrower should explain whether it is to be used for expansion, equipment purchase, paying off existing loans, or any other reason for requesting the loan.
- The Collateral – The type of collateral should be clearly specified in each loan request. If accounts receivable is used, lenders will usually loan up to 80% of that amount. If equipment is used, lenders will usually loan up to 50% of equipment cost. If inventory is used, lenders will usually loan 25% of the value. If real estate is used, lenders need to know net equity of the real estate and will usually loan 75% or the value.
- The Method of Repayment – The lender will want to know whether the repayment will be made over a short period or long period of time, and from what source.
- Required Documents:
- Commercial Finance Worksheet
- Commercial Finance Loan Application
- Purchase Agreement (if being purchased)
- Current Business Financial Statement
- Current Profit and Loss Statement
- Current Personal Financial Statement
- List of accounts receivables
- List of equipment (including type, serial #, and cost)
- List of inventory and supplies
- A 3 year income projection
- Two years personal and business tax returns
- M.A.I. Appraisal (if real estate is included)
- Signed Fee Agreement
- Sample Programs:
TODAY’S BANK PRIME RATE IS – 4.25%
Loan Type |
Property type |
Loan Amount |
Loan To Value |
Debt Service Ratio |
Loan Term |
Amortization |
Interest Rate |
Comments |
Adjustable & Fixed |
Commercial Finance – Business Loans |
ALL |
50% to 75% |
N/A |
5 years |
20 – 25 years |
7.5 – 8.5% |
Loans of $500,000 and up are more readily available |
Adjustable & Fixed |
Second Mortgages |
ALL |
70 -75% |
1.15 to 1.20 |
5 – 10 years |
20 – 25 years |
7.0 – 8.0% |
|
To get started:
Print the worksheet from the Printable Forms page. Fill it out then fax or mail it to us. Please inform us of its arrival.
- Commercial Finance Worksheet
