Five Questions to Ask Your Lender

*This post is from CMB partner Essex Lease. Visit them for flexible lending solutions.

When it comes to securing financing, having a great partner by your side can make all the difference. Few relationships will be more important to the success of your business than the one you have with your lender. So, it is well worth your time and effort to ensure you’re choosing the right one.

But too often, business owners forget that financing is a negotiation – you should feel comfortable asking tough questions. And by doing so, you’ll be better able to find a lender who can provide you with industry-specific expertise and the right financing for your business model.

So, whether you’re looking for flexibility, customer service or tailored advice, here are five essential questions you need to ask before signing on the dotted line.

1. Can I Structure My Payments to Meet My Cash Flow?

Managing cash flow is a critical aspect of running a successful business, especially if your expenses and revenues tend to fluctuate.

Your lender should be able to provide options for structuring loans that lower your monthly payments and keep your cash flow healthy. This might involve extending the loan term or exploring alternative repayment plans tailored to your cash flow needs.

2. What Kind of Flexibility Do You Offer?

Flexibility is key when it comes to financing in dynamic sectors. A lender who understands the cyclical nature of your industry is invaluable.

They should be able to work with you to structure debt obligations in ways that align with your industry’s patterns. This might involve seasonal adjustments or other flexible terms to ensure you can comfortably meet your financial obligations during both peak and off-peak periods.

3. What is Your Customer Service Like?

A relationship-focused lender offers more than just a loan – they offer expert advice.

Businesses that have a personal relationship with their lending partner will fare far better in the long term. Your lender should be willing to adapt to your changing needs and consistently offer excellent customer service & expertise – not just a loan.

4. How Long Does It Take You to Make Lending Decisions?

Timely decisions are crucial, especially when you need to seize opportunities or address unexpected challenges.

Ask your lender about their typical response times for loan applications. A lender who can provide rapid decisions can give your business a competitive edge.

5. What Factors Do You Consider in Lending Decisions?

Understanding the criteria your lender uses to evaluate your lending options is vital. Most business owners are familiar with the 5 C’s of credit, but what you might not know is that these factors are flexible; different lenders emphasize different aspects.

Working with a lender who understands your character is just as important as the numbers on your balance sheet can help your business secure a financing plan that sets you on a path for growth.

Choosing the right lender can significantly impact your business’s success. By asking these five essential questions, you can ensure that your lender is not only meeting your immediate financial needs but also aligning with your long-term business goals.

Are you ready for a different kind of lending relationship?

For over 35 years, Essex Lease Financial has been the best-of-the-best in the independent lending industry. We’re a personalized, flexible financing partner that works to understand your needs and secure the right customized plan for every business, every time.

Get in touch with us today to learn more or get started.