There are many business finance and commercial mortgage
misunderstandings involving the use of a Small Business
Administration loan (SBA loan) to buy a business
opportunity investment or commercial real estate. This
article will provide an introduction to several factors
that business borrowers should explore before proceeding
with this specialized type of business loan.
Two of the most difficult business loan and commercial
mortgage situations for a business owner involve obtaining
a Small Business Administration loan and refinancing an SBA
loan. There are practical business finance solutions for
both of these common business investment problems.
Are SBA Loan and Business Finance Programs Difficult?
There are usually two schools of thought about getting a
Small Business Administration loan to buy a business:
(1) Avoid this kind of commercial loan at all costs.
(2) Use such a business finance loan whenever possible.
These conflicting investment financing viewpoints are due
to a commercial mortgage business loan process that is
perceived as complex and difficult by many commercial
borrowers.
In reality SBA loan programs are more practical than they
often appear. It is critical to the success of a Small
Business Administration loan program to be working with a
business finance advisor and lender that is proficient at
this difficult commercial mortgage and commercial loan
process. There are many potential commercial financing
problems to avoid when attempting to obtain a small
business loans, and very few lenders are skilled in this
business financing area.
Anticipating Business Investment Problems Before They
Occur: Business Loan Refinancing
One of the major investment drawbacks of an SBA loan has
historically been the difficulty of refinancing the Small
Business Administration business financing later. Recent
developments have changed this commercial loan situation so
that it is now more practical to refinance a small business
loan. It is still accurate to say that refinancing is not
routinely available, but more importantly it is much easier
to obtain than it was in prior years.
Advance commercial real estate loan and commercial loan
planning can avoid some of the SBA loan refinancing
problems. First and foremost, if the original business
financing is arranged without a small business loan, this
will make later business refinancing easier than if a Small
Business Administration loan is involved. This means that
commercial borrowers should at least consider if the
initial business loan requires this form of commercial
financing before proceeding.
Obtaining a Small Business Administration Loan: Two Common
Commercial Loan Misunderstandings
One of the most frequent criticisms of an SBA loan program
is the amount of paperwork required to complete the
business loan and commercial mortgage process. What many
commercial borrowers fail to understand is that any
business financing process is likely to involve substantial
paperwork and formal documentation requirements. In the end
the key is working with a business finance advisor that
understands what is required and can facilitate the
submission procedures.
Beyond the paperwork concerns, a more critical and real
problem is working with an SBA lender that is not very good
at successfully completing Small Business Administration
loan requirements. Even though there are many commercial
lenders that publicize their ability to process these
complicated and specialized commercial loans, in reality
there are very few lenders nationwide who are consistently
successful at completing the complex loan process in a
timely manner.
Alternatives to SBA Loan Financing - Conventional Real
Estate Investment and Business Opportunity Loan Options
Conventional business finance options should always be
considered simultaneously with the possibility of obtaining
an SBA loan. As noted above, the feasibility of refinancing
a business loan or commercial real estate loan in the
future will depend heavily on the choices made by a
commercial borrower when obtaining the initial commercial
mortgage.
A conventional business loan or commercial mortgage might
be more feasible than many borrowers realize. The
possibility of refinancing either an SBA loan or
conventional business financing will ultimately be more
practical and successful when working with a skilled
commercial investment financing advisor and business
finance lender.
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Steve Bush is a business finance and commercial real estate
investment property loan expert. Find out more about
commercial mortgage - business opportunity loan strategies
recommended by AEX Commercial Financing Group at =>
http://aexllc.com
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