Why Would a Bank Not Loan To a Small Business Owner?

There’s a long list of things that will cause a conventional mortgage lender to refuse to lend you the money you need to purchase your dream home, ideal office building or refinance your property. I’ve always found it somewhat of a mystery that some very financially sound folks end up in that difficult and emotionally draining situation.

The reasons people are turned down for loans can usually be traced back to a single number on a sheet of paper. For many, it’s a credit score. Often a prospective borrower’s score is low due to a piece of ancient financial history that has long been corrected.

Reducing income tax

Small business owners can also find themselves in this situation. If you’ve ever been in business for yourself, you know that you can find perfectly legal ways to reduce the amount of income tax you pay. For example, you can make investments in your business or large contributions to your retirement account.

However, these strategies make your net income look low. Banks and other conventional lenders don’t see past the fact that many of those income-reducing expenses are discretionary. The business owner doesn’t have to spend the money for those things; a good chunk of it can go to the business owner’s yearly income to support the payments required by the new property purchase.

That’s why at Evoque Lending we work hard to honestly judge a borrower’s ability to make monthly payments. A single number on a piece of paper doesn’t mean much to us. We want to know what the person’s real situation is and determine what kind of payments the borrower is truly able to make.

Fairness for borrowers and investors

We think that is fair for everyone and protects everyone’s interests. We know that borrowers really don’t want to overextend themselves and put them and their families in financial trouble. Further, investors want to be sure that the people they are loaning money to won’t have trouble keeping up their payments.

The other thing that we look at evaluate carefully when making a loan, is the value of the property that is being borrowed on. For everyone’s safety, we want to make sure that the real estate is being properly valued. Again, no one wants to be paying too much for a home or office. Because we have been writing First Trust Deeds on Los Angeles real estate, Orange County real estate and San Francisco area real estate, we have a lot of experience in this area. We also work with excellent appraisers.

We’re here to serve you

I think you’ll find that Evoque Lending is also far more customer service oriented as well. We’ve heard some real horror stories about banks stringing borrowers along for weeks, only to deny their loans at the eleventh hour. Evoque Lending can give borrowers approval in 24 hours and close in seven to 10 days.

We want to earn your business and also let you know that you can refer your family and friends to us with confidence. So if you’re having difficulty obtaining a loan, please take a minute or two to contact us. You can call our toll-free number or drop me an email. We can quickly get you up to speed on the process and answer all your questions.