Here at Source Mortgage, we offer commercial loans custom fit to any business, big or small. Through this service, we can help business owners achieve their entrepreneurial goals.
What Is a Commercial Loan?
A commercial loan, otherwise known as a commercial mortgage, is a loan advanced to a business instead of a consumer. The nature of any industry, from beauty to construction, is cyclical at its core. Commercial loans help to balance that cyclical disposition. They allow business owners to get the money they need when they need it, for a wide variety of uses including:
- Purchase equipment or machinery.
- Purchase inventory.
- Increase working capital.
- Expand operations through new real estate.
The Five “C’s”
Applying for a commercial loan is much like any other funding process. Your rates and acceptance will be dependent on the five “C’s.”
- Character. Lenders will use similar tactics as a potential employer might. References, employee history, and work turnover are just some of these indicators.
- Capacity. The next quality that lenders will examine is your ability to reimburse. They want to know: how easily will you be able to manage this loan if your application is successful?
- Capital. To determine this, lenders will analyze the financial structure of your company. Factors like working capital and debt ratio will come into play here.
- Conditions. These will inform the lender about anything that may affect the performance of the company. This could be anything from the economy to your competition.
- Collateral. The final factor being taken into consideration by lenders is collateral. In other words, what guarantees are in place in the case of default. This could include inventory, equipment, or even real estate.
Ideal for Big and Small Businesses
All businesses rely on access to capital in order to fuel their growth. What will differ is the scale and scope of the funding they require. That’s why we offer commercial loans that can be tailored to fit the requirements of the businesses applying for them. We can provide you with loans to satisfy both long and short-term funding. Our loans are renewable for those times when unexpected expenses crop up.
Often with just 35% down, many of our clients use commercial loans to foster their business growth or even their day-to-day expenses. If you are considering a commercial loan, contact us today to get started!
