The commercial corner: Build your credibility by submitting applications correctly Mike Boggianocommercial mortgage, commercial loan application, loan submission package The Mortgage Press is pleased to present "The Commercial Corner," a monthly column by Mike Boggiano of Silver Hill Financial LLC dedicated to answering your questions about the commercial mortgage marketplace. If you have a question that you would like answered in a future installment of "The Commercial Corner," please e-mail [email protected]. Q: Can you offer advice on the correct procedure for submitting a commercial loan application? A: Perception is reality with lenders when it comes to your commercial loan application. Proper presentation of a loan submission establishes your credibility at the start of the process and demonstrates your commitment to the transaction. A well-organized, complete loan file that is properly stacked and tabbed for the specific sections will differentiate your level of professionalism from that of other brokers. Your file will receive preferential treatment from a lender when compared to those that are incomplete or disorganized. Q: What should my loan submission package include? A: A well-organized, complete package includes the following: •The loan application. The full application needs to be completed at the time of submission. Omitting information then adding it to subsequent sections of the presentation indicates to your lender that you lack control over the borrower and the transaction. The application needs to be verified for accuracy and consistency with other documentation that is provided such as: ownership entity, borrower's income, borrower's assets, subject property address, property occupancy and income, employment, assets, purpose of financing, payoff amounts, terms of the purchase and sales agreement, and credit. •The rent roll. The rent roll should include all rental information concerning tenants of the property. This includes the name of each tenant, square footage occupied, monthly rental amounts, term of the lease, operating expense escrows and scheduled rent increases. •Purchase and sales agreement (if applicable). The agreement should be in full force, in effect and not expired. If expired, provide an extension addendum that permits sufficient time to secure financing on the transaction. The contract itself needs to be complete and verified for accuracy. The purchaser(s) listed on the sales contract should match the borrower(s) on the loan application, and the property address on the contract must match the application. Finally, ensure that the sales price and financing terms on the contract match the application. Disclose any concessions granted within the contract. •Operating statements and tax returns for the property, and the borrower's tax returns. At a minimum, include year-to-date operating statements on the subject property plus those from the previous two years. In addition, two years of tax returns for the property (if the borrowing entity is a corporate entity) and for the individual borrowers are necessary. •Interior and exterior photos of the subject property. The old saying that a picture is worth a thousand words definitely applies in this case. Photos give your lender a feel for the physical attributes of a property. Q: What are some tips for working with a borrower who is not forthcoming with accurate information in a timely manner? A: You can typically gauge a client's commitment to the transaction by their cooperation level right from the beginning. Borrowers who drag their feet in providing the upfront information necessary to receive a pre-approval will likely present the same challenge during the underwriting process. Respecting your lender's valuable time and resources will help to further build your credibility. Mike Boggiano is senior vice president, national sales manager for Silver Hill Financial LLC. He may be reached at (877) 676-1562 or e-mail [email protected].