Commercial Lending Basics
Bgpic01052009030156 l Boost Business Without Breaking the Bank Although brokers still can profit in the commercial lending industry, current market conditions have depleted the average broker’s marketing budget. For a number of commercial brokers, it’s more difficult to establish themselves as viable professionals quickly and effectively. For brokers, your goal is threefold: to establish yourself in the commercial marketplace, to garner immediate commercial leads, and to build a qualified database of business-owners who are familiar with you and your company. By employing the steps below, you will be on your way to success in the commercial market. Become a student and build a reputation: Before you do anything else, take the time to learn the commercial business. Learn the terms. Make sure you know the difference between net operating income (NOI) and debt-service-coverage ratio (DSCR). There is a great deal of information available, from Web sites to magazines — read it. Become a student again and learn where to ask the questions. The Internet is a great resource, and so is your lender representative. Start with the basics: Things as simple as adding a tagline on your e-mail signature will do wonders for establishing your business. Adding “commercial loan specialist” or “commercial loan officer” after your name is instant credibility. Do this to your business cards as well. Along that line, add “We do commercial loans” to all of your e-mails and outgoing correspondence. You never know who will see those words and call. Of course, the same applies to your Web site. Network: Networking still works. It is a tested method of offering your services to a specific group of like-minded individuals. All Boost Business Without Breaking the Bank By following seven steps, you can create a strong database of viable clients communities offer networking opportunities at functions such as after-work mixers and special events. Those who participate in these groups are generally business-owners. Become a vocal member of your local chapter and seek not only business from the other members of the group but also referrals to other business-owners. Networking has been incorporated into the Internet, where your reach can be larger. Join networking sites that offer online networking capabilities. Not much effort is required to set up your profile, and the sites frequently offer tips for maximizing your contacts. Institute a daily telemarketing campaign geared to business-owners: This doesn’t have to be elaborate or time-consuming. Spend at least one hour per day making calls to local businesses and build your database. A simple introduction and offering your services is all it takes. Ask for an e-mail address. This call is not necessarily a sales pitch but an opportunity to network with other businessowners. Make sure you get the information you need for growing your business. This includes the primary contact’s name, e-mail address, ownership status and desire to discuss financing options. Again, your goal here is not to take a loan application but to have an opportunity to build your database. Take it to the streets: In addition to your telemarketing efforts, institute a day each week when you meet and greet your prospective clients. Walk into local businesses in your area. Dress the part. You are competing with bankers, so model your appearance after them. Above all, be professional. When you dress well, you gain instant credibility, and you are more likely to get the call when a loan opportunity arises. Leave your business card and take one of theirs — and make sure to add it to your database. In addition, go to your local banks, talk to commercial banking officers and ask what they do with turndowns. Ask if they would be willing to hand out your business cards when they have an applicant they cannot qualify. Banks generally will do whatever they can to better serve their customers, and a quality referral from a bank goes a long way with a borrower. The banks often are willing to do this because their primary business is depositors, and you offer them no direct competition. Now that you have spent time and effort getting your name out there, capitalize on every contact that comes your way as a result. Start big and finish smart: Although a localized, grass-roots marketing plan will provide you with a qualified database, you can market effectively to a wider audience if finances allow. Your title company can provide lists and labels of commercial property-owners. By instituting a statewide or targeted nationwide direct-mail campaign, you can build your database of potential borrowers and get loan applications along the way. A simple direct-mail piece — such as a postcard informing a buildingowner that you would like to discuss financing options — could provide leads, as well. Use your database: As your database grows, send regular e-mails to your clients. Create and follow a timeline so there is an e-mail in front of your client at least once every 30 days. Experts say repetition is the key to marketing. There are services available that can assist you with creating, managing and sending professional e-mail campaigns for a fairly small price. A good e-mail campaign will reap significant results with the right database. Keep your database clean by following up with your potential clients regularly, as well. Update contact information with pertinent data, including the topic of your last conversation, and keep a diary of the contact for followups based on your conversation. There are many ways to build your commercial loan business without investing a financial fortune. Time and effort are all it takes. Be smart with your time, and value each contact as if it were gold. A true grass-roots marketing effort and a well-maintained database will yield a treasure trove of future business.
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Founded: 01/05/2009
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