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How to Become a Commercial Loan Broker


Interested in information on how to become a commercial loan broker? There are a few areas of the business you need to master in order to succeed as a commercial loan broker.


Interested in information on how to become a commercial loan broker? There are a few areas of the business you need to master in order to succeed as a commercial loan broker.

1. You have to be very good at pre screening deals - so that you do not waste your time chasing transaction that will not close.
2. You need a strong lender network.
3. You need multiple, reliable sources of leads.

Becoming a commercial mortgage broker isn't rocket science but it will take time to establish yourself and to get to the point of really knowing what you are doing. Be careful of sources telling you how easy it "really is". These sources are usually lenders with rates 200 to 300 basis points higher than most and are looking for beginners to pawn off these rates to their borrowers.

Pre Screening Deals

A lot of time and effort goes into all deals. Knowing how to analyze a loan request is very important. You need to be able to sit down with a package and in 20 minutes figure out if you will pass on it or work on it. It's very easy to waste 100's of hours on a loan that doesn't have any real chance of closing.

There are many reasons why loans are not fundable but it's normally a combination of loan to value, credit and income. The hardest one to figure out is the amount of net income that can be used. Tax returns are complicated and there are many tax shelters and area that expenses can be reported twice. So you need to be very good a reviewing a deal and decide if it has "legs".

Strong Lender Network

Having a strong lender network in place is also very important. Number one you have to know their programs cold. You need to know what they really like, beyond the matrix. Also you need solid relationships with the individuals you work with. You need quick, thorough decisions. Having your files on top of their pile is important.

Marketing

You need to compete on a lot of transactions in order to find doable deals and ones in which you can have some control over. There are a lot of marketing methods out there and most of them will work in this business, due to the high payouts.

The traditional method of developing relationships with the local investors, commercial real estate brokers, CPA's, attorneys, bank representatives, etc is still a very good method. This still maybe the best route to go, though it takes a lot of time and effort to build a name in your market. Newer methods include mailers, email campaigns, ads in newspapers, etc. Regardless of which route you feel more confident about you need some type of program that gets your phone ringing and keeps it ringing. Be patient and survive the "green" period in your quest to become a commercial loan broker.

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Article Source: http://EzineArticles.com/?expert=Jeff_Rauth

  
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