Business Loan and Commercial Real Estate Financing Options

Business borrowers have more commercial mortgage loan alternatives than they realize. I refer to these business loan and commercial real estate financing alternatives as "Thinking Outside the Bank" because a typical commercial borrower probably believes that a bank is the best source for a commercial real estate loan or commercial loan. Non-traditional business lenders are usually viewed as having the competitive edge for many common investment business loan scenarios.

A bank might offer to provide business financing but require overly stringent terms. In other cases a traditional bank will decline the commercial loan because they do not provide commercial mortgage loans to the commercial borrower's business category. For both examples, a commercial borrower will benefit by "Thinking Outside the Bank".

Some business loan borrowers are likely to feel that a traditional bank is their best source for a commercial mortgage. However, because most traditional banks focus on a small number of established industries and investing areas, non-traditional (non-bank) and non-local commercial lenders should be considered for most business financing situations. Therefore the recommended commercial loan strategy (as discussed in this article) is to "Think Outside the Bank".

As I reported in a previous business loan discussion, in many commercial mortgage situations it is common for a local bank to assess stricter commercial loan conditions than would typically be seen in a competitive business financing scenario. Such banks can often take advantage if there are few business lenders in their market.

An appropriate response by commercial borrowers is to seek out non-bank business loan options. It is neither necessary nor wise for commercial borrowers to depend only upon local traditional banks for business financing solutions. For most commercial mortgage situations, a non-local and non-bank commercial lender is likely to provide improved commercial loan terms because they are accustomed to competing aggressively with other commercial lenders.

There are at least three commercial loan situations in which business borrowers will typically experience that non-traditional lending sources can provide conditions that are best for the borrower: (1) commercial mortgage loan programs; (2) credit card factoring programs; and (3) working capital management programs for credit card processing.

Commercial Loan Programs for Investing - Commercial Mortgage Business Loan Choices

Two of the worst commercial real estate financing problems for business owners can be eliminated by "Thinking Outside the Bank". The first commercial mortgage business loan problem is the typical bank practice to eliminate most special purpose business properties (such as golf courses and funeral homes) from their investment lending portfolio.

Another commercial financing scenario is the common practice of commercial banks to include recall terms in their business loans. With such terms the bank can require repayment of the commercial mortgage under stated conditions. These undesirable business financing and investing requirements can usually be eliminated by using a non-bank commercial lending option.

Business Loan Options - Business Cash Advance Programs

Most businesses that accept credit cards will qualify for a business cash advance with their credit card receivables. Traditional banks will typically be very poor candidates to consider if a business needs assistance with credit card factoring and business cash advance services.

Because even thriving businesses frequently need more cash than they can borrow from a bank, it can be of critical importance for a business to "Think Outside the Bank" and locate non-traditional lenders to assist with this business financing need.

Credit Card Processing Programs - Working Capital Management Choices

The selection of a credit card processing service can be critical in improving the cash flow of a business with significant credit card activity. Credit card processing providers can be combined with the credit card financing process mentioned earlier.

In managing a merchant cash advance program, it is often possible to obtain a significant improvement in credit card processing activities. It is probable that a non-traditional lender will be the key source of effective help with credit card processing because traditional banks are usually not competitive in providing assistance with credit card financing.

An Important Investment Business Financing Reminder

I have written an earlier business loan article about commercial lenders to avoid. It should be noted that there are in fact both traditional and non-traditional (non-bank) lenders which should be avoided. When commercial borrowers "Think Outside the Bank", it is still of critical importance that they are prepared to avoid a wide variety of problematic non-traditional commercial lenders in their search for viable business investment financing, especially when it involves business cash advance (credit card receivables and credit card factoring) programs, credit card processing services and commercial real estate financing.

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Steve Bush is the CEO of AEX Commercial Financing Group and Commercial Mortgage Business Loan Solutions. Steve and AEX Business Finance provide candid commercial real estate financing and commercial loan advice for business cash advances and business financing throughout the United States.

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