Holly, NC (PressExposure) October 22, 2010 -- CBL, known for their free financial reports, has just released there latest report discussing the commercial business loan.
"A commercial building loan is a bit different than a residential building loan," says Mary Thompson, owner of CBL. "The loans are structured differently and there is usually a minimum loan amount. There are other differences as well that are not immediately obvious. Having good credit is a very important part of securing a building loan in the first place; there is not much difference between each type of loan when it comes to having to have the credit in place. The difference is that when you are trying to secure a commercial building loan there may be several different credits that are being looked at. A residential building loan usually only depends on the future owners credit."
The report covers some of the important factors for qualifying for a commercial loan.
"Trying to secure a building loan for a commercial project will depend on a few factors. Typically the credit score of the business will be considered, this information is usually kept by Dunn and Bradstreet or Standard and Poor each of these entities rate credit worthiness of a business they use a special formula to determine the amount of risk that is involved with a business. Some of the key elements that they consider are on time payments to creditors, holdings and number of employees," says Mary.
"The bank or the financial institution takes the report from these companies into consideration; they also look at the officers of the corporation's credit worthiness as well. The smaller the company the harder they look at the officers of the company," says Mary. "Credit matters because the financial institution usually will have quite a large stake in a commercial project where they stand to lose a good bit of money if the company should go belly up."
The report also discusses the size of commercial loans.
"The amount of a commercial building loan usually starts at five hundred thousand dollars at a minimum. There are some banks that will make smaller loans, but for the most part the size of the loan is going to be a strong indicator of how the loan will be categorized," says Mary.
Categorizing the loan as a commercial loan is important to the banks because there are a whole set of banking rules that actually give the bank a bit more leverage than if the loan was made for residential construction. Naturally the bank or financial institution is in the business of making a profit so being able to have more control over the loan is important to them.
"Small business checking accounts are specifically geared toward the small time owner," says Mary Thompson, owner of OAFCA. "They are business accounts that have lower fees than larger business accounts do. They often are coupled with a line of credit to help the business succeed. Finances are very important to any business but even more so to a business that is just getting started, being able to get on your feet as a business owner can mean the difference between being a success or a failure." Access the free report to learn more about commercial loans and the free checking account options.