Commercial Loan Process
While every financing arrangement seems to have its own quirks, all tend to follow a similar process. The process generally takes from 14 to 60 days depending on such factors as loan type and collateral.
1. Project Summary
Provide us with a summary of your financing needs so we understand your financing objectives. The easy way to do this is use our on-line application form. However, you're also welcome to send us an email or give us a call. We'll review your information and let you know the financing terms we feel we can secure for you.
2. Placement Agreement
If the loan amount and terms we quote are acceptable, we will prepare for you a Placement Agreement. This is a non-exclusive agreement in which you engage the services of Texas Lone Star Lending to seek financing for your project. We must have this to move forward with your financing request. You also will need to sign a credit release authorization.
3. Collect Your Supporting Documents
Use our List of Commercial Financing Documents to collect the necessary documentation to support your financing request. Be as complete as possible, but don't get bogged down on this step. We will prompt you for any missing information we feel is critical to support your request.
4. We Shop for Investors
Depending on the type of financing request, we may contact several lenders and investors to find financing options that fit your needs. Our intention is to find and negotiate the best possible rate and terms.
5. Conditional Commitment
Many investors will issue a "Conditional Commitment" if, based on the project summary, they believe the financing request meets their investment guidelines. A Condition Commitment is much like a pre-approval in residential lending. The investor isn't ready to write a check, but it like what it see so far.
6. Select an Investor
At this point, we have one or more financing options, and you must choose which option best meets your needs. We will advise you on the advantages and disadvantages of each, as we want you to be comfortable with your selection.
Please be aware that many investors require an upfront fee (often called a "commitment fee") as evidence of your good faith to continue beyond this point. In addition, some investors require as part of the commitment that you allow them the exclusive opportunity to satisfy your financing needs. If you nullify the opportunity, you are likely to lose any upfront fees you have paid.
We will work with the investor you choose to document and underwrite your financing request. This involves verifying the documentation you provided, performing appraisals and assessments of the property or project, as well as other due diligence for the investor. The investor also may request additional documentation from you. Provide it as quickly as possible.
When financing is approved, you will be required to sign closing documents. If property is involved, closing will occur at a title company or attorney's office.