3 Keys To Obtain Funding For Commercial Finance Deals
1. IDENTIFY YOUR GOALS FOR THE PROJECT
Before deciding to take on a project, outline your main objectives of the project. Intelligent investing starts with the purchase and or acquisition of choice. Every investor should have a purpose for each project. Goals should be realistic and a strategic results plan can be orchestrated to ensure that the goals are met. Create a budget, with a schedule use of funds, and contingencies for the project. Have target dates and deadlines in place even for small administrative tasks such as budget completion date and or application for a loan submission. Write these goals down and review them daily throughout the process of preparing for the next steps to lead up to your funding request. Create an items checklist and mark off items as you move along, some applications can be tedious and require the submission of extensive paperwork.
2. IDENTIFY THE RISK TOLERANCE ASSOCIATED WITH THE PROJECT
You must understand the risks that are associated with your project. If this is a project that will potentially keep you awake at night, how do you suppose the Lender will view the project? Lenders like projects with a clearly defined exit strategy. The more questions that can be answered centered on what happens if disaster strikes, who are the major competitors, who your target audience is very helpful when asking for funding. Lenders want to know that you are educated on the demographics with the ability to demonstrate diligence on the market or region and some of the extraneous factors that may arise during the project. Always remember Lenders want to lend money, not own projects.
3. PASS THE FINANCIAL FITNESS TEST
In this technological age information is in access of abundance. There are several opportunities and many transactions available for Lenders to review. If you want to place your deal near the top of the list have at least a minimum of 20% to 25% in reserves of the asking amount you seek to borrow. Lenders want to know that you are actually financially capable to handle the project. Presentation of assets is very important and cash is not always the only option. Some projects may require the reallocation of investments however the main goal is to obtain funding so be prepared to sacrifice some cash.
Autonomy Capital Partners LLC
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