What to Ask Your Lender Before Submitting a Loan Request


Not only is it important to find the right commercial loan broker, but it’s crucial that you understand everything involving a loan before you request one. While there are many loan options out there, a professional broker will be able to give you a pros and cons list of each one – and recommend which one fits your business situation the best.


For those that are on the search for their first-ever business loan, it can be confusing searching through all the information out there. Here’s what we would recommend that you focus on asking your lender before ever settling on a loan:


What is required as collateral?

Different loans require different types and amounts of collateral, and the total funding of the loan you need will also affect this. Some loan types require a specific type of collateral, while others are more relaxed in their specifications and will accept a personal guarantee instead. Your lender can help you determine what would be good collateral up against the amount of loan you are hoping to receive.


What fees are there?

Loan approvals are not simple decisions made by lenders. In fact, many outside vendors might be called in for various reasons throughout your application process, which will increase the total costs. These might include site inspections, recording fees, credit reports, and more. However, your lender should be upfront about these fees with you and can typically give an estimate of the costs before you apply.


What’s the APR and Interest Rate?

APRs come from calculations of the interest rate and other lender fees included in the loan. Since each lender might create the APR calculation for a loan differently, be sure to ask your broker specifically how your loan will be broken down. Pay attention to how often the interest rate is adjusted and be aware that the APR of a loan is not applicable for early payoffs.


Is the loan application approval decision made in-house?

Depending on the type of loan you are interested in and whether or not your lender has an in-house underwriting team will determine if your loan can be processed by them. Government-backed loans typically have a longer approval process, which is something to be aware of if your business is looking for a quick decision. This leads into the next question:


How long does it usually take to close on this loan?

A lot can ride on the approval of the loan you are seeking, which is why understanding the length of time it takes to process a loan is important. A good lender will coordinate with you on a closing date, as well as work with you to ensure your paperwork is all in order throughout the process.



The more you understand loan offerings, the more you’ll feel comfortable applying. Let us help you determine the right loan for your business to help you grow and thrive!