Don't feel bad. At one time or another just about every small business owner has experienced the uncertainty of commercial financing. Granted, it's not the kind of thing you do every day. Nevertheless, as a moderately successful small business owner, you would think there might be some better way of knowing if you have the ability to secure outside financing. The good news is that there are some practical rules of thumb that can determine just how realistic obtaining a commercial loan is for your business.
Commercial lending is a heavily regulated industry.
Business plans, financial projections, income tax returns and reams of supporting documentation are often the norm. Well, regardless of any individual bank's willingness to lend, their primary goal is increasing shareholder value. Combine that mentality with the discomforting fact that most new small businesses don't survive beyond their third year. This is why commercial borrowing can appear so frustrating. However, it's not all bad news.