Becoming a Commercial Mortgage Broker
By William Pirraglia, eHow Editor
You can read the full article below or at eHow
Commercial Mortgage Brokers are in Demand
Larger companies often have banking relationships that include pre-authorized commercial lines of credit and low interest commercial real estate loans. But smaller businesses seldom have this luxury. Since 80 percent of American companies are classified as small businesses, the market for effective commercial mortgage brokers is large. Small businesses are constantly challenged to find affordable financing for commercial real estate; commercial mortgage brokers fill this need.
Needed Knowledge for Commercial Mortgage Broker
A new commercial mortgage broker needs to learn about the market conditions in the area, the names of the most active local lenders, the names of the aggressive regional or national commercial lenders, and the types of loans offered by each. Unlike the residential mortgage industry where interest rates, qualification rules and required documentation are mostly standardized, the commercial mortgage industry is more like visiting a flea market--everything is negotiable with rates and terms specific to individual lenders. Know the market and know the lenders to become effective in this field.
Working Relationships for Commercial Mortgage Brokers
Commercial mortgage brokers need to have working relationships with at least a few business lenders because of the nature of the industry. With little standardization of rates and terms, brokers need to have a variety of reliable commercial lenders to have the ability to place mortgage requests with the most agreeable loan sources. Different lenders like certain industries while disliking others. Some lenders like certain types of commercial real
estate (factory, office, retail, strip mall, etc.) while disliking others. Commercial mortgage brokers should have a file of at least one lender for each typical borrower (company type) and property type.
Small Business Administration Loan Guarantee Requirements for Commercial Mortgage Brokers
The largest market segment for brokers, smaller businesses, are best served by the Small Business Administration (SBA), which understands that entrepreneurial companies are neither Microsoft nor General Motors. Many future clients will need SBA guarantees to make their loans work. Learn as much as you can about the regulations published by the SBA.
Licenses Needed for Commercial Mortgage Brokers
Fortunately, commercial mortgage brokers in most states need not be specifically licensed as residential mortgage brokers must be. However, always check out local regulations to learn if licensing is required. Often, however, a general or retail business license is still required to permit the business itself to operate.
Advertising for Commercial Mortgage Broker
Network, advertise and get the word out. There are more potential clients than even the best commercial mortgage broker could ever help at one time. But the client base must know the new business is ready to get financing for businesses needing commercial mortgages.
About Willion Pirraglia
After 28 years as a Senior Executive in the banking industry, William has been a full-time freelance writer since 2005. He has authored 2 books (101 Mortgage Tips, 101 Bankruptcy Tips) available at Amazon, Barnes & Noble, Borders, and other book stores. He's written for many prominent companies and their websites, including Kelly Services, Franklin/Covey, and Rentals.com.Source: www.sncloans.com