1st May 2022
Most business loan brokers are paid in the form of a flat rate fee, or a percentage of the deals they are helping to arrange, plus any residual fees built into the agreement. Some lenders offer commissions which are scaled to the size of the lending agreements, while individual businesses are more inclined to hire brokers if their fees do not make the overall amount too prohibitive. Most independent business loan brokers have more leeway in adjusting their fees up or down than those brokers employed by brokerage firms.
Striking Out On Your Own
The world of commercial finance offers a wide array of lending products for businesses and commercial real estate investors in need of money. Business loan brokers who prefer to work on their own might want to consider opening their own businesses and start making inroads with commercial lenders, as well as bringing over previous clients to help build their own portfolio without the lion's share going to the brokerage firm.
Putting Numbers In Perspective
A business finance broker needs to be able to look beyond the bottom line. Offering only numbers is something that traditional brokerage firms do, and a lot of time is leads to deals that end up falling through the floor, because the amount of money a business needs often has little to do with why they need it or the reasons their current financial situation is the way it is. Independent brokers need to look at the full context of the needs and goals of clients. Similarly, lenders – while more focused on the dollar amounts – also need to know the full story as to why your clients present certain financials, what they need, and why they are seeking certain funding. This gives you and the lenders the ability to come up with alternative solutions in case the clients do not qualify for their initial funding requests. Experienced independent brokers treat their clients as partners, because they understand that their success and ability to get the funding they need translates good revenue for the broker.
Independent commercial business loan brokers do so much more than arrange loans between businesses and lenders. Brokers also work with entrepreneurs to refinance existing debt, arrange financing and leasing agreements for equipment, helping new business owners launch their startups and franchises, and even collect revenue from outstanding accounts for entrepreneurs. Businesses and investors look to finance loan brokers because they have the depth of knowledge to find the right type of financing to fit the situation at hand, and can present alternatives to conventional loans because there is no “one size fits all” solution when it comes to businesses. Every business is unique, and each business needs financing tailored to their circumstances and goals.
Independent Loan Brokers Have More Personal Freedom
As discussed earlier, business loan brokers have more freedom when it comes to their rates and the size of deals they can arrange. Similarly, independent brokers enjoy more freedom in their personal lives than those working for banks and firms. Frequently, brokers working for firms cannot explore or enjoy their passions, because most of their time is spent poring over financial statements and running between clients and the chain of command at their own brokerage firms. Independent business loan brokers, by contrast, can choose to work as much or as little as they want. Between residual revenue from smaller deals https://rapidloan.net/payday-loans-fl/ on up to those sizable agreements which can net tens of thousand of dollars at a clip, independent brokers can make their own schedules and pick their clients, rather than constantly pounding the pavement and spending late nights and weekends trying to make the numbers work for a small commission.