What defines a "real" commercial lender? In this case, by "real," I have to use the Merriam-Webster definition of the word, which is "not artificial, fraudulent or illusory; genuine;" being precisely what the name implies (i.e., a real professional). It sounds pretty impressive, doesn't it? How in the world does a commercial lender live up to the standard of Merriam-Webster? Ask most teenagers, and they might say that few adults or business entities they encounter anymore are able to "get real." How many of you who have teenagers have been told more than once to get real? Of course, that little statement usually comes with a roll of the eyes and the assumption that anyone over the age of 20 is old. But in this case it's different. No matter your age or number of years in the lending industry, it's time to get real about commercial lenders and what makes one genuine and professional enough to add to the list of lenders you are willing to do business with.
One thing that causes me great frustration is a company or individual that takes on a name and a profession, declares themselves to be the real thing, the genuine article. Yet from their demeanor, their lack of customer service and lack of knowledge, it's more than apparent that they know little to nothing about their chosen profession or products they have in their repertoire. It's fairly frightening to get into a position with a commercial lender who says they offer a particular outstanding product yet, when push comes to shove, you, as the broker, are left out in the cold with a possible client chewing their fingernails wondering why they ever came to you in the first place.
Does that sound like an all-too-familiar scenario or, at the very least, one you surely want to avoid? The problem could indeed be the lender or it could be merely a case of you, as the broker, not doing your homework and finding a quality, professional commercial lender. Let's face it folks - just because you are able to do a risk analysis for a customer and have solid knowledge of the underwriting process itself makes no difference to the client if you come up short on the product and your deal falls through. Bottom line is the client just cares about the bottom line and when they'll get their money. Finding a genuine lender that you communicate well with, who offers what they profess to offer in a timely, professional manner is as key to your own business' success as it is to theirs.
In an effort to assist you in your search for reality, I have a few tips for finding real commercial lenders you can work with, as well as for securing positive, mutually beneficial relationships with them:
Interview your lenders
That's right, folks. This might sound backwards to many of you, but this is your business, and part of your job is to look out for the clients you'll be working for. You have every right and the responsibility to make sure that the lenders you're working with are the real deal. Ask the tough questions. If they are virtually unheard of, check them out with others in the industry. How many loans have they closed or funded in the past calendar year? Are they insured? Are they a fly-by-night limited liability company or a quality lender in good standing? Remember, this is the time to find out if they are the genuine article - the real thing!
Make sure your repertoire has more than one or two
lenders in it
Having a hard time finding quality lenders who specialize in your niche? Go to the business and trade magazines for more information. Network, read blogs and do your research! Just because you find one lender with whom you make a connection and can count on to be professional, timely and honest with you does not mean you've got it made. It's highly unlikely that you'll be able to funnel all your loans through one lender. If that lender insists they can do it all, pick your coat up at the door and leave, because trust me - they won't be able to do it all!
Make sure you do your homework on your
Keep lists of whom you've dealt with and whether you had a great experience or a bad experience, as well as a list of which lenders specialize in what products. Don't embarrass yourself by going to a lender who only deals in unconventional loans for clients with C and D credit and solicit for a hard money loan or a private investor.
Make sure your lenders have knowledge of the current
market and the changes in market trends
If the lenders aren't keeping up with the change in the markets, then the products they offer will not meet your clients' needs. If you can't bring the products to the people to fulfill their lending needs, then what's the point? But do remember that certain lenders specialize in a particular niche, just as you should.
Find commercial lenders who will work with you rather
than against you
The lender can be your ally but they will only put their trust in you once you have proven that you have the competence and confidence to do your job.
As you look for real commercial lenders who spell out their products, expectations and fees up front, remember that dealing with genuine, authenticated commercial lenders also gives you credibility. If you want to be seen as a broker who has in-depth experience, possesses analytical thinking and professional traits, then you must work with others who do so as well. The broader you make your base of commercial lenders, the more you will be able to offer your clients. But remember, you don't want to come across like an inexperienced teenager to a client or commercial lender. I would say that more than one lender has rolled their eyes and muttered, "Get real," as they attempted to deal with an inexperienced, unprofessional broker. So in your quest to find real commercial lenders to align yourself with, remember, the good ones are going to want to work with a real, genuine professional broker as well.
Kellene Bishop serves as president of Beehive Commercial Lending, as well as director of training for Commercial Career, which specializes in training residential loan officers in all aspects of commercial lending with an additional emphasis on successful marketing tactics. She can be reached at [email protected].