What is a Business Loan Broker?
Getting a business loan can be tricky. With so many options out there, it’s hard to know where to start. That’s where a business loan broker can help. Keep reading to learn all about business loan brokers and how they can make getting financing for your business way easier.
They Find You the Best Loan Options
A business loan broker is an independent professional who helps business owners find financing. They take a look at your business and financial situation, and then search through their network of lenders to find loans that match your needs. This saves you from having to do all the legwork yourself.
Brokers have relationships with tons of lenders, from big banks to online lenders and more. They can get you access to way more loan options than you’d be able to find on your own. And they’ll match you with lenders that are likely to approve you based on your unique situation.
They Handle the Application Process
Applying for a business loan can be a major pain. You have to track down paperwork, fill out long applications, and more. But with a broker, you can hand all that hassle over to them. Brokers will work with you to gather everything the lender needs. Then they’ll submit your application and act as the point person during the underwriting process. This saves you time and headaches.
They Negotiate Better Rates and Terms
Lenders will often offer better deals to brokers than individual borrowers. That’s because brokers send them a lot of business. So brokers can leverage their relationships to negotiate great rates and terms for your loan, like lower fees or a longer repayment period. A good broker may be able to get you way better financing than you could on your own.
They Explain All Your Options
There are tons of different business loan products out there. Term loans, SBA loans, lines of credit, and more. A broker will explain how each type of financing works and the pros and cons. They’ll offer advice on which options make the most sense for your particular situation. This helps ensure you choose the right loan product.
They Provide Ongoing Support
The relationship with your broker doesn’t end once you get approved for financing. Good brokers will check in periodically during the repayment period to see how things are going. They may also be able to get your loan terms adjusted if your business hits a rough patch. You can think of them as your long-term loan advisor.
How Do Business Loan Brokers Get Paid?
Brokers earn their living through commissions from lenders. After you get approved for a loan, the lender pays a percentage of the total amount to the broker. Rates vary, but commissions are often 1-3%. As a borrower, you don’t have to pay anything directly to the broker.
How to Choose a Reputable Broker
Make sure to do your research before choosing a loan broker. Here are a few tips:
- Ask for referrals – Talk to other business owners about brokers they’ve used.
- Check credentials – Look for brokers who are certified and have solid industry experience.
- Interview brokers – Have in-depth conversations to gauge their expertise.
- Compare services – Ask what exactly they’ll do for you throughout the loan process.
- Read reviews – Look for brokers with consistently positive feedback from clients.
Taking the time to find a trustworthy, skilled broker will pay off big time. You’ll have an expert guiding you through the financing process.
The Bottom Line
Working with a business loan broker simplifies getting financing for your company. They have the knowledge and lender connections to match you with the right loan product at competitive rates. Brokers handle all the hassles of applying and can negotiate great terms on your behalf. Their guidance will save you time and stress. So if you need funding, partnering with a broker is the way to go.
At Delancey Street, our experienced advisors work hard to connect our clients with the ideal financing options. Learn more about our business loan services and get in touch today to start the process.