As we’ve previously discussed, commercial lending is a subjective business, and every lender has their own opinion on borrower strength. However, we can all agree that it takes a combination of the 5 C’s of Lending: Credit, Collateral, Capacity, Conditions and perhaps least talked about – Character. With everything going on with a loan application, borrowers can sometimes forget about the Character element, and their loan ends up derailed… and in some cases, irreparably so. But it doesn’t have to be that way!
Here are some common mistakes to avoid in order to uphold your character:
Don’t Fluff the Numbers
Of course you want to impress us, but when it comes to your financials or even your pro forma, be honest with your numbers. If the numbers don’t line up with your tax returns, or if you can’t support how you arrived at your pro forma calculations, we may start to question your credibility. It’s best to be honest… if we see potential, trust that we can help you highlight your actual strengths and work with, fix, or finesse your weaknesses.
Don’t Be Late on Payments… or Taxes
We don’t just look at the numbers – we look at your entire payment history for the last 10 years. Make sure you’re making your payments on time, especially before and during the loan application process. If you do have any derogatory marks, be sure to fix it beforehand or be forthcoming and provide an explanation.
Don’t Hide Lawsuits
We can help help you resolve a number of application issues with proper communication – but we can’t make a lawsuit go away. No matter how big or small, divorce or liability issue, do not keep your lawsuits a secret! Be sure to disclose all of your lawsuits and other major legal affairs upfront. If you fail to do so, the trust will be broken… and it’s very difficult to go back and repair that trust.
Don’t Be Difficult to Work With
It’s one thing to have questions and do your due diligence, but being argumentative or refusing to provide documentation can halt or cancel your loan altogether. Remember, your our team members are vouching for you and also agreeing to take on your risk. The last thing we want to do is to also take on a client’s bad attitude.
Have you been denied from a bank or lender because of a mistake due to a lack of information? We’re here to help. In fact, almost 90% of the loans that we close were first denied by another bank or lender. That’s because we take a look at the loan from 1,000 feet up – and see the whole picture. If it makes sense, then we’ll close your loan with our in house fund or one of our 300+ affiliate funds.
Submit your loan for review using the button above or give us a call today at (888) 959-1648 and let us take a look and see if we can’t help you repair and restart your loan process. Remember, there is no obligation necessary to get a review and discuss your options.