Playing By The Rules: How To Secure A Commercial Loan

by Stacia Peterson

With baseball season in full swing, now is the time to get your game on, particularly when it comes to finances. For some, that means starting a new business. For others, it’s about taking your company to the next level. And for all, it begins with a better understanding of where you want to be – and where you wish to go – in the future.

Obtaining any type of financing these days is a team effort, and bankers must be on deck from the very beginning to simplify the process and educate their clients about all of the available opportunities.  

Get Personal

Before you even step up to the plate, start planning. Be prepared to open up to your lender and share your past, present and dreams for the future. This personal communication method makes the banker/client relationship a more seamless experience for everyone involved. This type of interaction is priceless!

One more thing: The earlier your banker gets involved, the easier it is to choreograph the best game plan. The borrower needs to reveal a full history of both the good and the not-so-good for a banker to be the most effective. This first meeting is all about connecting in order to make things happen.

Get Specific

Gather multiple years of financial information for your banker. This includes both business and personal documentation, which can get very precise depending on your financing requirements. A borrower’s needs – ranging from business acquisitions and expansion to commercial real estate and operating lines of credit – determine what information is necessary, and your banker can provide a list of exactly what is needed.

Things to discuss: Everything! Talk about lending options, cash flow, collateral, sponsorship, terms and structures to repay the debt.

Get Prepared

Once the borrower’s financial records are submitted, a banker carefully reviews the paperwork before making recommendations. More conversations happen, and they center on specifics pertaining to the loan structure (five years, 10 years, etc.) as well as products and services available to support other needs. At this point a banker may request further information in order to fulfill and expedite the process.
Express yourself: This meeting is all about conveying your questions and concerns regarding the financial process. Be even clearer about what your aspirations are plus how your banker can make financing happen.

Get Going

Once you decide on your plan of action (and then have your financing approved and received), it’s time to move forward. That doesn’t mean you should stop interacting with your banker. Quite the contrary. Your banker is now a trusted adviser you can rely on.  Every business depends on three key players (the other two: an accountant and a lawyer) who are accessible and ready to answer questions.
Keep growing: Continue to communicate with your banker for all things growth-related.  By maintaining a strong relationship, a borrower benefits from a solid and reliable partnership for all future endeavors.

Securing financing can be a painless process if you are organized, informative and open to opportunities. A knowledgeable banker, just like a baseball coach, is essential in creating a game plan in order to navigate through the many available options.

Stacia Peterson is the senior vice president of commercial lending at The Business Bank of St. Louis.