What is a Commercial Lender?
by Adam Smith
Undoubtedly you have heard of other business people speak of their commercial
lender, but perhaps you were not exactly sure what they were talking about. Just
what exactly is a commercial lender, and how do they differ from a consumer
lender? This is an excellent question since this issue confuses many people.
Fortunately the explanation is rather simple.
Consumer Lender
When we think of consumer loans we think of loans extended directly to
individuals like you and me. Typically these loans are extended for relatively
small amounts to finance the needs of individuals. A consumer loan might be
extended for the purchase of a car, remodeling one's house, or even to purchase
a diamond ring for your future spouse. When we speak of consumer loans and
consumer lenders, we are talking about divisions of a bank that serve individual
people, otherwise known as consumers.
Commercial Lender
Commercial loans are quite different than consumer loans. Maybe it is easiest
to think of commercial loans as business loans. These loans are for commercial,
or business purposes, such as building a shopping center, developing a
subdivision, or creating a new apartment complex. Loans that are extended with
higher values are often thought of as commercial loans. A commercial lender
would be the lender that extends these commercial loans. Commercial loans can be
taken out for many different purposes.
Many businessmen visit their commercial lender when they are interested in an
income
property. An income property is just what it seems, a piece of property that
will bring in a steady stream of income. Many investors looking to purchase an
income property will take interest in an apartment loan, since apartment leases
and rentals offer a steady stream of income over time.
Remember, a commercial lender will be extending loans to people with
legitimate business objectives, such as investors interested in investing their
extra income into an income property that will return them a
positive cash flow. As mentioned before, those looking for an apartment
loan to finance their income property will desire the services a commercial
lender can offer.
It is important to note that most big banks will dabble in both types of
lending. Thus it is entirely possible for your bank to serve the community as
both a commercial lender as well as a consumer lender. To determine what type of
lender your bank is to you, you can ask one simple question - what is the
underlying reason for my loan? If the loan was taken out for business purposes
then you bank is likely acting as commercial lender. If the loan was taken out
for personal reasons then the bank is serving you as consumer lender.
If you are interested in increasing your wealth, don't be shy. Research your
area, find an income property that fits your financial objectives and visit your
commercial lender today. You might be surprised what sort of apartment loan
or commercial financing they can offer you.
Article Source: http://www.ArticleBlast.com
About The Author:
Adam Smith is an information author for 10X Marketing. For more financial information, please visit SNC.com
