Business Loans are a sensitive subject. Business owners will enter these conversations with a mix of hesitation and a little bit of skepticism. They want to make sure they’re getting a good deal from a reputable lender.
This is why the lending space will always have a need for smart, helpful, business loan brokers who put their clients first. Even though business owners can do a lot of the research on their own, having a trusted advisor in your corner telling you, “Yes, this is a good option to go with,” or, “No, I’d avoid that one,” definitely goes a long way.
So, whether you’re looking to get into this space or just started your practice, here are a few tips on how to become a high-performing business loan broker.
Get Started: How do you become a business loan broker in the first place?
It all starts with making sure you have the licenses required by your state. About 40 percent of states have some sort of requirement in place. From an article on the Commercial Loan Broker Institute:
“Each state has a licensing board that can provide this information. You can also check with member organizations in the banking industry or with your local branch of the Small Business Administration. Currently, most states do not require commercial loan brokers to be licensed. However, about 20 states do require some form of license. This may apply to only real estate loans, only non-real estate loans or may be required for both. If you are required to be licensed then you will need to meet the specific licensing requirements that are necessary and can include certification and testing.
It’s very important to check thoroughly about license requirements rather than to assume your state does not require one. There may be financial or even criminal penalties involved if you operate your loan broker business without a license where one is required.”
Get those ducks in a row first before going any further.
What’s Next? Commercial loan broker training programs
Even if you already have a business/finance/accounting background, it might be worthwhile taking some more refresher courses/reading up on new trends in the space. If you haven’t already, consider working at a bank for a year or working at a commercial loan brokerage. It will be very valuable to learn from someone with years of experience in the space and to build your network with them.
From there it really comes down to a decision whether you want to work at a firm or start your own consultancy. There isn’t one right answer here, and it will be personal choice around how much responsibility you would like to take on. Starting your own business can be a rewarding lifestyle decision, or it can lead you to become a job creator which is its own reward (and responsibility). Joining a team with processes and deal flow in place can allow you to really focus on what you’re great at instead of being a jack-of-all-trades business owner.