How an Agency Brokerage Consultant Helps You Navigate the Commercial Loan Process

commercial loan process

Whether you’ve already located an agency to acquire or are still on the look out for the perfect acquisition opportunity, you need financing before you can seal the deal. Navigating the commercial loan process can be tedious and often discouraging process. When your deal hangs in the balance, you can’t afford a misstep.

Here’s how an agency brokerage consultant will help you navigate the commercial loan process.

See Things Through the Lender’s Eyes

The first step to navigating the commercial loan process is learning to see it through the lender’s eyes. What are they looking for? What would make them see your acquisition as a good credit risk? What red flags might sway their decisions?

In the insurance industry, you’re hyper-focused on identifying and mitigating risk. Your lender is too.

An agency brokerage consultant will help you identify what lenders are looking for, and looking at. They understand what lenders need to see from you. Chances are that your acquisition is exactly what they want to finance, but if you don’t know what they’re looking for, it’s hard to demonstrate that.

An agency brokerage consultant will present your acquisition in the best light to lenders. They’ll demonstrate that you’re exactly what they’re looking for in borrowers.

Evaluate Your Position

A consultant will do this by assisting you in objectively evaluating your position. Most lenders will be looking at 3 primary areas to determine if you’re their ideal borrower.

Cash Flow

A brokerage consultant will help you crunch the numbers to determine the cash flow in your proposed investment. They’ll look at:

  • What the current cashflow is
  • How it will weather a transition
  • How you can turn liabilities into assets

Solid Experience

A commercial lender will only consider you a good credit risk if they believe that you have the experience within your organization to acquire, integrate and manage the company you plan to acquire.

As you well know, all insurance is not the same. Companies may have different target demographics and populations with different needs. Of course, this may be why you want to acquire. You’re looking to expand and grow vertically in addition to horizontally. But in order to do this, you need to demonstrate to the lender that your in-house skill is up for the challenge.

An agency brokerage consultant can help you evaluate your in-house capabilities to put your best foot forward in the lending process.

Powerful Credit Profile

Your company will additionally be under increased scrutiny. The lender will want to see everything. A consultant will help you gather your necessary documents and get your ducks in a row so that you can secure that loan.

Determine What Type of Lender Aligns with Circumstances & Goals

It may be tempting to cast your seeds broadly, applying with multiple commercial loan companies. But this is a waste of time and money. Instead, optimize the process.

Some lenders will have a higher level experience with certain types of companies. Because of this greater level of experience, they’re better able to evaluate risk and see the opportunities you see.

We’ll help you streamline the process by seeking financing from companies who understand what you do and are most likely to lend you money at the best terms.

Finalize Terms To Complete the Commercial Loan Process

When it’s time to finalize terms with a lender you must know where you stand, what your options are and what makes sense to you.

In addition to the potential in the investment itself, a consultant will evaluate:

  • Your current asset holdings
  • Your available collateral, in instances where you qualify solely for an asset-based loan
  • A reasonable payment schedule for you. They may be able to negotiate more favorable terms in exchange for a shorter-term loan.

A great brokerage consultant will help you evaluate where you stand and then work help you get terms that make the most sense for you.

Complete the Acquisition with an Agency Brokerage Consultant

Once your agency brokerage consultant has helped you navigate the treacherous commercial loan process, it’s time to complete the acquisition and begin managing your new company. The road ahead won’t be easy. But by working with an agency brokerage consultant you can be assured that you’ve laid a strong foundation for your success.

As agency brokerage consultants, we know the insurance mergers and acquisitions process inside and out. We can help you achieve great results. To learn more, contact us today.