How to Negotiate a Better Deal on Your Next Business Loan

When it comes to borrowing money, many business owners make the mistake of leaving money on the table during negotiations.????

This is a big mistake because borrowers usually have additional untapped bargaining power.? Knowledge is power. When buying a car, it's easy to obtain the invoice to help you better negotiate with the dealer. Why wouldn't you follow the same logic when borrowing from a bank?

Instead, you need to know the "cost" of the money the bank will offer. Most banks have a pricing matrix, and they will likely tell you IF you ask. Do they price off the U.S. Treasury, Wall Street Journal Prime Rate, etc.? Once you know this information, you are armed to negotiate a better deal.

You can deploy a few simple strategies to get better rates, terms, and conditions.

The result can save you thousands of dollars per year, and tens or hundreds of thousands over the lifetime of your loan.

For example, on a $2 million loan, saving 1% on the rate and 0.50% on the origination fee can result in savings of $1.1K per month, $13.6K per year, and $193.5K over 10 years.

So, the next time you are looking for a business loan (equipment, working capital, commercial real estate), make sure you use the Business Loan Leverage Tool. This loan calculator will let you compare multiple scenarios, so you are better equipped to negotiate with the bank on your next commercial loan.?

If you'd like a copy of the calculator tool, drop me a message and I'll send it to you privately.

Regards,

Patrick