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$200,000 Commercial Loan – Getting Funded In Hard Times

$200,000 Commercial Loans

$200,000 Commercial Loans

At CLF we are seeing more traffic here from business owners needing a $200,000 loan (or more) to get themselves through the recsession, and sometimes to take advantage of a depressed assets that are up for grabs, for cheap – either way, it’s no simple matter finding a $200,000 loan in today’s economy.

More often than not, business owners need much more than two hundred thousand dollars – they need a million, or 5 just to keep the doors open, employees paid, creditors paid, leases, paid, and banks paid. Commercial loans that are applied for an approved by conventional banks don’t seem to readily available for approval sake, so most all commercial loans are being sought after with private lenders. Many times private money is what keeps businesses afloat. Banks often move much too slow and there are too many stings attached.

In commercial real estate for instance, private money is often what is required to leap on time sensitive opportunities, whereas the banks spent allot of time securing themselves, or just allot of time saying no, or making the deal virtually risk free. The way the banks work these days is this; they take a risk with other people’s money, and if they lose, THEY don’t lose. If they win, they take the credit, and the profit. Even when they see a good solid commercial investment with a very high chance for success, they won’t approve the the loan without complete security.

I remember asking when I was young, “if I had the assets for collateral then I wouldn’t need the loan would I”. The same old Catch-22 plays for a 5000 dollar loan, a 10000 dollar loan, or even a 200000 dollar loan. One thing for sure with a 200K loan, you won’t likely get the loan fast. Because of the size of most commercial loans, it’s a slow process borrowing big sums of money. It’s sort of a constant fight and you have to be constantly be proving your companies worth and viability. It CAN be an advantage to sometimes hire a “money man” and all he does is raise funds. Often these “money men” are venture capitalist to the core, and were born for the job. Some are ex-bankers who have the connections and are in the know when it comes to raising money.

You can raise $200,000 dollars is a variety of ways. If you have some sort of security the banks can get their dirty hands on, then you can get the loan with them. If you have share holders and share structure you can dilute your shares (maybe) and sell more shares to new investors. This is usually a real piece of work, and it’s expensive paying for the lawyer bills required to get an offering statement written that sufficiently covers every-one’s rears (so to speak). One thing for sure though – there are no gaurantees saying that a $200,000 commercial loan will even solve your problem(s) – but it surely can’t hurt.

So from my own experience with commercial loans, I would suggest looking for a money guy who will take a slice the pie in a finders fee. If your small business is a good risk and has a great chance for success, then the broker will have an easier time finding you the 200K. These brokers work with venture capitalists, and have a lists of wealthy investors who want to invest in “for sure deals”, and they do it for profit – sometimes huge profit of course. But like I said, your commercial enterprise will have to have some realistic estimates showing future profits. You need to have an offering made so these private investors can see your claims in writing. They need to have something to hold you and/or your company and existing stake holders on for security. The offering and business plan has to based on facts and solid market research, or forget it. This commercial loan may take awhile to get, like I said, and I’m sure you can see that you won’t get your loan overnight.

Not to give up hope in anyway, you just need to get some help. Help in the way of some smart money movers with a list of possible investors, and some good research people (maybe a market research firm) to help you convince lenders to take stake in your dream and lend you the 200k. Best of luck.