What is a Financing Broker?
By Dale "Dusty" Thele
The Financing Brokerage business is actually one of the oldest professions. Over the past few decades the financing broker role has taken on various terms like: "Financing Broker", "Money Broker", "Financing or Financial Consultant". In reality, they do not "broker" anything. They do not function like Stock Brokers, Real Estate Brokers or Insurance Brokers, they function as a middle person whose primary purpose is to bring the borrower and lender together to complete a successful funding transaction.
A Financing Broker: 1. does not invest any money of their own in a loan and is not responsible for the loan after it is funded.
2. operates in the same manner as an independent insurance agent who works with many insurance companies.
3. evaluates the loan request, constructs the loan package, finds the best rates through an extensive network of partner lenders and is paid a commission at loan closing.
4. can save the borrower valuable time and money, acting as a representative on the behalf of the borrower to secure the best possible funding solution to meet the borrower's financial situation.
An advantage of using the services of a financing broker is that this type of commissioned professional has access to loan options and other financial solutions that may or may not be easily identified by a borrower. Because the financing broker has a vested interest in assisting the client in securing financing, he or she often will investigate traditional and non-traditional loan options to find the best solution for the client. This ability to tap into such a wide network of resources often leads to the securing of a loan even when the client has been turned down by numerous bankers and other lenders.
The USA Mortgage and Banking Meltdown stopped the flow of commercial lending in the US, at least from the media's point of view. Potential commercial borrowers were convinced that they were unable to move forward with projects as they were unable to secure funding from banks. Banks and depositor-based financial institutions invest only a small fraction of the overall Commercial Funding business in this country. Much of the lending comes from non-bank financial institutions which were not as adversely affected by the Sub Prime market as were the banks. These non-traditional lenders depend largely on Financing Brokers to originate commercial loans for them to fund. The money is not GONE for commercial lending, true, it is not found in banks, but Financing Brokers have access to lending sources that most commercial borrowers are not aware exists. Financing Brokers could very well be the stimulus that is needed to get funds flowing again into viable commercial projects in this country. It maybe years before the institutional banks will be lending for commercial projects, but competitive funds are available through Financing Brokers.
It's time to change our thinking, deposit your money in the bank, but let a financing broker secure your commercial financing.
About the Author
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| Dale "Dusty" Thele, Cedar Creek Commercial Capital 401 Congress Ave, Suite 1540 Austin, TX 78701 512-852-4391
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