Own a small business? When preparing to discuss commercial loans with your bank, be sure you have thought through your investment in its entirety.
Cornerstone Bank’s loan officers will have a lot of questions for you to answer, but we’ll also make the process as easy, quick, and convenient as possible.
To help you feel prepared, here are a few questions or scenarios we’ll run past you.
Questions to Ask Yourself Before Applying for a Commercial Loan
1.What is the Loan-To-Value (LTV) ratio? In other words, how much money are you able to put down on the loan? Depending on the case, your bank may require you to put down an amount ranging anywhere from 0-15%.
2.What collateral do you plan to use to secure your loan? Conventionally, most people put the property/purchase itself as collateral for their commercial loan. However, depending on the face value of that property at the time of purchase, you may need something more secure in order to appear capable of paying back that loan.
3.Will you apply as an individual or as an entity? The majority of commercial loans are taken out by entities, such as a business, organization, or corporation. However, you will have the option, in most cases, to apply as an individual investor.
4.What is your credit worthiness? Do you have a good credit history? Whether you decide to apply as an individual or through your business, lenders will still assess the applicant’s credit history to determine the feasibility of getting paid back for that loan.
5.How much time do you feel you need to pay back the loan? Unlike a residential mortgage loan (many of which have 30-year terms), commercial loan periods are much shorter. Commercial real estate loans can range from 5 years (or less) to a maximum of 20 years, but with amortization periods that can last longer.
Types of Commercial Loans
Want to learn more about commercial loans? Hear from our commercial loan officer, John V. Doull, who has been with Cornerstone since 2007.
Learn more about commercial loans from the experts
Since 2001, Cornerstone Bank has put our customers first, and that means giving them the best that mobile banking has to offer.
Cornerstone Bank services the large and flourishing community of Kansas City. While a $15,000 loan might not be important to a big bank, we understand how much of a difference that can make to a small business. You’re more than just a number to us.
Need further assistance with or have questions about commercial loans? Contact us online or via phone and we’ll be happy to help.
Next: hear from our commercial clients
Want to hear about the Cornerstone experience directly from our clients? Now’s your chance! Here, we sit down with NAME to discuss their commercial loan experience at Cornerstone Bank.