What Are Commercial Loans?
First, let’s talk about the definition of a commercial loan. It is a loan secured by your commercial property, or your business and your commercial property, or by equipment used in your daily conduct of business. Discover all about commercial loans here.
Applying for a Commercial Loan
Next, let’s look into the process of qualifying for a commercial loan. There are five phases, application, pre-approval, processing, underwriting phase, and the closing. The first two phases, application and pre-approval determine whether or not you will qualify for a commercial loan.
In the application phase, you have to submit all the required documentation to show your credibility, creditworthiness, the stability of your finances and your business and of course, your experience. It may refer to the length of years the business has been in operation or your personal experience as a business owner, depending on the lender’s policy. However, not all lenders require heavy paperwork.
Approval Process
The usual pre-approval phase also includes the pre-qualification process. It’s a quick way to get a ballpark idea of how much the lending institution can loan you and it can be done over the phone. The common questions that loan officers ask include information regarding your income, assets, current debts and the type of loan you may qualify for. The pre-qualification process often takes a few minutes.
Documents, Proof Of Income, Credit History
The pre-approval process takes longer than pre-qualification. The loan officer shall require you to submit documents to prove your income, assets and your credit history is usually taken into consideration. Traditional lenders often charge a fee for the pre-approval.
What Lenders Consider
Most lenders take into account your personal financial standing and that of your business. It is an intricate process where the lender looks into the documents you submitted and verifies them. If the lender is convinced of your capacity to repay the loan, it may release a document that contains the likely terms of the commercial loan, interest rates and other associated costs.
Pre-Approval Is Time Consuming
The pre-approval phase is time-consuming so you may have to look for a lending institution that values your time and understands the urgency of your situation, like ALC Commercial. Our small business loan experts only require minimum paperwork to take the hassle out of the pre-approval process. In fact, we can answer all your questions and give you an estimated amount of loan over the phone and it would only take a few minutes! Here’s more-we can approve your small business loans within 24 hours by simply applying online through our easy to answer application form in our enquiry button.
No Obligation Query???
If you want a no-obligation enquiry, we have commercial loan consultants to answer all your questions. Contact us today and take advantage of our commercial loans options such as low doc, bad credit and short-term business loans. We also have Commercial Equipment Financing & Loans, Startup Business Loans, and more commercial loans options!
