Articles by Andre Gibson

Another commercial loan option, please!

Wednesday, March 30th, 2011

(Andre Gibson, of Sycamore Commercial Lending, LLC, will tell his own story of how he derived the business model for his company which matches lenders and small business borrowers.)

“I’m sorry Mr. Jones but we are unable to grant you a business line of credit; your loan has been declined!” Declined… but I have been banking here for 10 years. You have my checking account, saving account, the kids’ accounts, and my mortgage. This is the thanks I get for being a loyal customer?

Unfortunately, I had this conversation on many occasions as a Branch Manager at a couple of national banks. The conversation was never easy and also came with a lot of heartache and embarrassment for both me and the borrower.

As a result of these kinds of conversations, I came to the realization that there was a business opportunity here for me. I knew there had to be a better way to go about connecting borrowers to money. So in November of 2008 I founded Sycamore Commercial Lending, LLC. The basic strategy behind the idea is to become the “E-Harmony” of commercial lending. We get to play match-maker for lenders and borrowers!

The concept of commercial loan brokering is not new but now there is a new spin on it. In the past, commercial loan brokers specialized in one or two areas, mainly equipment leasing or business acquisitions. The new type of commercial loan broker represented by Sycamore Commercial Lending, LLC might remind you of a residential mortgage broker shop.

There are many types of commercial loan products out there but most small business owners do not know how or where to find them. This is where we enter! Sycamore Commercial Lending, LLC’s set up closely mirrors a residential broker shop. Our team includes loan officers (or loan originators), processors, and compliance officers. But instead of offering only one or two products, we offer 10 or more products to help match the business owner to working capital. The key is to make the proper match.

To ensure my match-making skills were up to par I had to attend many training sessions on how to become a commercial loan broker. I spent 40 hours in the classroom to learn the ins and outs, dos and don’ts of the brokering process. I also attended 20+ hours of trade shows and seminars to meet with lenders. Lenders are the key to this loan brokering process. The first step to brokering commercial loans is to get approved by as many lending sources as you can. That process is pretty simple but can be labor intensive. Basically you have to provide evidence that you understand the lender process, have access to clients, and have a banking or lender background. They also do a pretty aggressive background and credit check before approval. Once approved the next big step is to “know your lender”!

As a broker you have to understand (thoroughly) how the lender likes to lend. We call this their “sweet spot”! As you can imagine lender “sweet spots” vary greatly, so to be a successful broker, I needed to learn the lending tendencies for each of my 40 lenders nationwide. This is like being back in school and studying for the big exam. Failing to know your lender’s “sweet spots” can be detrimental to your business.
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