TRAINING SERIES ON UNDERWRITING COMMERCIAL FINANCE
TRAINING SERIES ON UNDERWRITING COMMERCIAL FINANCE
Part 1
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Charles Pixley
RAMA ENTERPRISES, Inc.
Real Asset Management Associates
515 Madison Ave., 5W, New York, NY 10022
charlespixley@rocketmail.com
Skype: toanangel
585 217 2191
Volume 1 Issue 1
TRAINING SERIES ON UNDERWRITING COMMERCIAL FINANCE
INTRODUCTION
I am honored to be able to offer you this course which will be emailed to you over the next few weeks. Please feel free to ask questions, as I am sure if you are unclear others may have the same question and together we will have a better learning experience.
Will try to reduce the subject matter to the least amount possible and convey the greatest amount of understanding.
Ideally this information will help you garner a more well qualified base of clients as they learn of your professional ability and ultimately the most important point of all, achieve a win for your client and then a win for you when it the deal closes.
The basic definition of commercial lending is to provide finance to a business, or property, whose ultimate function is the creation of profit.
The purpose of this newsletter is to provide you with specialized information on underwriting commercial loans, which is hard to find and its various types, under the heading of capital finance, so you may address the specific needs of a targeted audience.
This is designed to guide you through the fundamentals of audience as concerns understanding COMMERCIAL LOANS & UNDERWRITING and how “INVESTORS,” a.k.a lenders evaluate scenarios and qualify the proposal and prospect for potential funding.
GETTING STARTED
This business takes guts, drive and intense persistence, and the ability to survive financially, the period of time required to understand, build a book of business and know how to underwrite the various proposals and where to go to find the funds.
In our current market non-traditional sources of funds have become the go-to or lender of first choice, so the opportunity to review a myriad of deals is immense.
Some borrowers are highly sophisticated and know far more than the average loan officer, however, for the most part, simply don’t know what they are doing and don’t understand the process.
These days, almost all business borrowers have been, burned, turned out, or turned down, or simply they are ill qualified. Most unsophisticated clients embellish values, and don’t tell the whole truth and nothing but the truth, and that makes your job as an underwriter more of a Sherlock Holmes.
Many borrowers try to manipulate the money into what they think they want or should get, or they flat out are liars, or worse yet they are frauds. But, as you know money is like water, it seeks its own level and it KNOWS intrinsically what to do and what the rates are.
Unless you have the aforementioned I would not recommend entering this business, full time, at all. Although one never stops learning, nor finding new creative ways to structure deals
Realistically, the learning curve, if you were to do nothing but commercial loans, all day everyday at a modest rate of about 50 calls and interviews per day, can be about one year.
Once you have a working understanding, have been beaten up by borrowers and lenders there is a clarity focus that comes and all the pieces come together, THEN it becomes much easier.
Perhaps, the most important element of all is that, your clients can hear the experience level in your voice. Therefore, as you become more confident, you will inspire confidence in your clients and they will be more receptive to giving you their business.
In the next issue we will cover THREE IMPORTANT RATIOS and how these values are determined and the pitfalls from an commercial underwriters perspective.
commercial appraiser-appraisal