by Debi Enders
The key to getting a business loan lies with your credit score, having the cash flow to support the repayment, and your collateral. The relationship you have with your banker, however, may provide you the ability to negotiate a better interest rate, term, or reduced fees.
Like other products and services, bankers have standard pricing based on the amount of risk they take, but they also look at the relationship they have with you. If you have additional accounts or services with the bank or would move other banking relationships to that bank, you’d be in a better position to negotiate because it allows your banker to have more leverage in working out the best deal for you. Consider not only the liquidity of your collateral (certificates of deposit versus your receivables) but also if you have a good mix of business assets in addition to your own personal assets.
With your relationship established, a good mix of collateral and a good credit score, your banker should be willing to negotiate a loan that will work well for both of you.
Debi Enders (debi.enders@commercebank.com) is vice president, small business banking at Commerce Bank.
Submitted 8 years 79 days ago