04 Dec Keep Getting Turned Down by Banks for a Commercial Loan?
Do you and your small business know what to do if you keep getting turned down by banks for a commercial loan? In general, most small businesses do nothing to pursue other potential avenues that could help them secure capital for their financing needs. The three main reasons for the “negative inertia” on the part of the small business community are the following:
- Mass marketing and advertising of a communities’ local banks. Banks have large advertising budgets and they flood the marketplace with print ads; TV ads; highway billboards and the like and they tend to stay in the “face” of the small business market segment.
- Non-bank lenders tend not to spend as much on their marketing and advertising budgets as the banks do thus they are not as well known to the small business community who may not be aware of the services that non-banks offer to these businesses.
- Small businesses who are having difficulty obtaining conventional financing do not spend enough time networking with outside professionals nor do they perform enough of their own research into the commercial lending industry. Specifically; the internet is an excellent tool that can be utilized by the small business sector to locate non-bank lenders and attending local business functions and speaking with attorneys; CPA’s and other outside professionals may enable a small business to generate a referral of a non-bank lender who may be able to provide financing for that business.
Every small business that is having difficulty obtaining conventional bank financing should be cognizant of the three above referenced factors that may be contributing to the lack of access of capital that these businesses need for financing purposes.”