Are Business Loan Brokers Worth Hiring?

As a small business owner, the only thing standing between you and growth is sometimes a lack of funding. You have fantastic opportunities in front of you, but you lack the capital you can invest in them.

Are Business Loan Brokers Worth Hiring?

As a small business owner, the only thing standing between you and growth is sometimes a lack of funding. You have fantastic opportunities in front of you, but you lack the capital you can invest in them.

While researching your options, you may have come across business loan brokers. These companies aren’t banks or lenders — rather, they analyze your financial situation, then leverage a network of lenders to find the optimal credit product for your business.

Of course, brokers charge a fee for this service. 

Are business loan brokers worth hiring? Why not look for financing on your own and save money? Read on to learn why you should consider working with one.

Why Not Get a Business Loan On My Own?

You can get funding for your business on your own. Other entrepreneurs do it all the time.

The problem is, finding financing on your own will take you a significant amount of time. It involves hours of researching your options, ironing out your business needs, navigating a marketplace full of lenders trying to sell themselves to you, negotiating with lenders, understanding lending terms, and on and on.

And none of that guarantees that you end up with the best funding source. Any savings from avoiding hiring a loan broker may be eaten up by additional interest charges or other lender fees.

So although it’s possible for you to secure financing on your own, you likely don’t have the time to figure things out yourself. After all, you’re not in the loan-finding business. 

Business loan brokers are, though, so you can rely on one such as ourselves to find you the right funding while minimizing your time investment.

Why You Should Work With a Business Loan Broker to Secure Funding

As a business owner, you have a lot to deal with — yet you only have so much time and energy to spare. 

This is what makes a business loan broker so valuable. 

But the benefits extend beyond time savings. Here are some benefits of using a broker to find financing for your business.

Explore Options

Brokers have access to many types of lenders. Banks are no longer your only option. You can rely on business credit lines, SBA loans, and even alternative financing sources (such as hedge fund capital or royalty-based funding).

You may not know much about these options or where to find them, but brokers do. They’ll teach you about all of your options so that you can have a better understanding of the marketplace.

Leverage Expertise

Whether you’ve obtained business financing by yourself before or not, it’s not what you’re in business to do. You may not be fully aware of the documentation needed in the application process, or perhaps you don’t understand loan terminology.

Brokers work with lenders every day and are intimately familiar with the entire industry. Not only can they sift through the marketplace to find you the best options, but they can help you understand loan terms. 

Some brokers will even assist you in preparing your application materials. Using their expertise, they’ll paint the best possible picture of your business’s financial health so you can attract more lenders.

Great Rates

Brokers can provide you with plenty of options by distributing your information to their network of lenders. Each of these lenders wants your business and will compete for it, leading to low rates and good lending terms.

Also, as mentioned above, your broker will likely help you prepare your application so that you look as good of a borrower as possible.

How Do You Choose a Business Loan Broker?

 

money in hand

Now that you know the positive impact a business loan broker can have on your business, you may be ready to work with the first one you come across.

However, not all brokers may not have your best interests in mind. Some may be looking to squeeze money out of you through high fees, while others may favor certain lenders or loan products because they’re more lucrative to recommend to their clients.

Before working with a loan broker, consider the following factors.

Lending Network Size

The more lenders that a broker works with, the more potential options you have when looking for credit. Consequently, you’ll have multiple lenders competing for your business, resulting in lower rates and better terms.

This competition is quite powerful when combined with a broker’s expertise in spotting a fantastic deal.

Funding Source Variety

Network size is essential, but so is variety. Remember that you have an array of funding types these days, so you don’t want a broker that limits your options to one or two. Otherwise, you could miss out on affordable funding sources that suit your business well.

For example, BCCUSA’s diverse lending network provides you plenty of options, from traditional term loans to credit lines to royalty capital and more.

Unbiased

Your business loan broker should be there to serve you first and make money second. No source of funding is perfect — a good broker will make sure you understand the pros and cons of your financing options. They’ll ensure you know why they chose particular funding vehicles for you, and make you aware of the drawbacks.

No Pressure

Although brokers work fast to find you the optimal funding vehicle for your company, they should still give you time to think about it. Ultimately, it’s your business. You get to decide if you want to use the funding source they recommend. If they pressure you into taking a loan, they may not be a good broker to work with.

BCCUSA is a business loan broker that advocates for you. We analyze your balance sheet and financial situation, then find you the best lending options from our diverse lender network. No need to stress about the application process, as we handle all the tedious correspondence with lenders. Schedule your free 30-minute consultation with one of our experts today — let’s explore your possibilities.

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