This time of year, three of my favorite things come along: the Masters golf tournament; the arrival of Spring; and the Easter holiday. Each of these is wonderful in its own way, and believe it or not, all three teach us something about commercial mortgages.
Spring and Easter are about renewal and about things not quite being what they, at first, appear to be. Just when you think your crapemyrtle tree will never flower again is about the time little pink shoots start to appear. Up North, where I’m originally from, as the last snow melts smidgens of green start to slowly show beneath the last stubborn pieces of ice. This season is about going from seemingly certain death to life again. These occurrences help remind us to throw out those out-dated notions and make room for the new and improved.
The same can be said for the way we finance commercial property for owners of small and mid-sized businesses. Some have the misguided notion that our commercial mortgages are more expensive, higher priced, more complicated, and take longer to close. These are terribly old perceptions, and blatantly false. Nearly every other day, we’re issuing commitment letters while our borrowers’ banks are still mucking around asking menial questions and collecting documents. In fact, we’ve come to joke about our greatest strength being our greatest weakness: we approve deals so fast, numerous unscrupulous borrowers have shopped our approvals only to be matched or barely beaten … completely lost on them was the value our speed and the reduction of borrowing-related anxiety in the first place. That, alone, is reason to work with us, and why we should be charging double for what we do, but I digress …
Plenty of people have told us how their banker said our loans would be so difficult and expensive, only to later switch their deposits to another bank after our closing because they can no longer trust that same banker. Continuing to hold false beliefs about the commercial mortgages we specialize in costs brokers time, prospects, and closings. And, if you’re an owner of a small or mid-sized business or someone who advises them, not working with us costs even more. It’s been said that it’s tough to be a prophet in your own land … this certainly resonates with us as less and less of our loan volume seems to come from Central Florida, which is a shame as we’d like nothing more than to help those in our own community first.
See, more local business owners can afford commercial property when they realize they can still get a great deal, but only put a third to half as much equity in and get longer amortizations with longer fixed terms. Cash is king for business owners, as the adage goes. Many want to own, but they’ve been told by ordinary bankers they’ll have to bring 15% to 30% to the closing and pay for soft and closing costs out of pocket. They’ve also heard that 15 to 20 year amortizations are the norm and that interest rates can only be fixed for 3, 5, 7, or sometimes 10 years, but then their terms will balloon and they’ll have the expense of a future refinance.
Allowing owner-users to take whatever their banker says as Gospel, causes more time to be spent getting properties sold because of a smaller pool of buyers. It also limits the amount of repeat business done as rarely will business owners come back in the future for another deal (like many of ours do) when they just liquidated their savings to accommodate their banker’s desire to reduce HIS risk… while subsequently increasing THEIR risk tying-up valuable capital in their building.
None of this is necessary, and it’s why we call our commercial mortgages “SMARTER FINANCING.” Never before has a nationwide lender led ONLY with the best commercial loan product for business owners EVERY time … it’s so good, we’ve used our loan product ourselves, a fact few bankers could also admit. It’s easy to hold onto dated perceptions, but time marches on and things improve … we’ve literally reengineered our portion of the finance industry with the national awards, clients and referral testimonials to prove it – it’s time more local beliefs about this get renewed.
And what about the Masters? Just what does it have to do with some commercial mortgages? That’s easy. From a distance, both look charming, simple even. But upon closer inspection, those attributes prove deceiving. It’s a much more difficult course than appearances might suggest. Very easy to choose the wrong instrument to accomplish your goals. It also isn’t naturally, quite so green … some “enhancements” make it appear better than it is. And just like with our mortgages, it’s very easy for any banker to claim they can provide the wealth-creation financing that we specialize in, 504 loans, but it isn’t quite that simple. Those with the best overall game win at Augusta and applying the same lesson to commercial mortgages: the Best Overall Value for business owners should win every time and is provided by specialists, right in your backyard.
This Spring, commit to renew your beliefs about the types of commercial mortgages available and give long-held assumptions a test. Things renew for the better every Spring. Email us at info@mercantilecc.com when we can help you or those you know finance commercial property.
To Our (Yours and Our) Best Year EVER,
Chris
Recent article from our newsletter by Chris Hurn . . .
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This month we will officially be four (4) years old as a company. With that in mind, I think it’s probably time to share some reflections about our beginning, and more importantly, about our “continuing.” See, from Day One, I wanted to reinvent and revolutionize the business we’re in — it was the reason for our genesis. I had been rethinking the logic of commercial lending from my perch as a management consultant about five years ago. It needed its mold broken, in my opinion. The banking business as usual was/is dead . . . ask Geof sometime — I used to mutter this to myself regularly, and it’s only gotten worse in that most have only fallen farther behind since that time.
Looking back, it may seem a bit lofty to restate it here publicly, but we really didn’t think we were starting a bank back then. We believed we were launching a movement. A movement based on building wealth for small business owners and fulfilling their dreams with our smarter financing. By “smarter,” we meant (and still most certainly do): leading with the Best loan product; requiring less equity to buy commercial real estate; providing the least expensive financing available even if it meant smaller loan amounts for us (part of the genetic make-up of our lead product); offering longer amortizations and fixed interest rate terms; focusing on the highest cash-on-cash return available; creating fewer headaches and hassles; and overall, lowering the risk for our Clients. All of these “smart” things simply weren’t done until we came on the scene and packaged them all together. We were the first and are still the ONLY nationwide lender to always LEAD with the BEST. We’re still the Experts at this loan product, and we’re known as the Specialists, as NO generalists will do. To us, putting our Clients first wasn’t merely a slogan for a television or radio commercial . . . we actually meant it and proved it, time and again. On our website is the proof — plenty of Client and Referral Source testimonials. If your bank doesn’t have any, maybe it’s time to think “why not?” And if your bank doesn’t mention 504 loans or if you can’t find it listed until the tenth click or so on their website, well then . . . I’ve proved my point again.
We have always thought of ourselves as a Marketing and Sales organization with very select financial products to offer the marketplace. We were not a bank first, then the “other stuff.” With us, it was/is the other way around. We were once laughed at and dismissed as an upstart, “too unconventional,” an underdog (but we acted like, and still do, an Insurgent). “How can you form a commercial lending firm around only one product?!? And one with a government guarantee at that!” Because we did our homework first. Because we were determined. Because the government rarely delivers its phenomenal programs in a simplistic fashion. Because we were right and still are. And because we were willing to ignore the criticism and become exceptional instead of listening to the naysayers and settling for mediocrity like crabs in a bucket pulling others back down.
Looking around now, those same people aren’t laughing anymore. It’s gotten harder and harder to ignore us these days. Sure we’re unconventional. Sure we act like mavericks still to this day . . . but we’ve proven that being different makes ALL the difference. We’ve never been merely another ordinary lender. A tee-shirt I saw on the plane a couple days ago captured my thinking on this, “First, we become the BEST, then we Become FIRST.”
To quote the Wall Street Journal Business Bestseller and New York Times Bestseller authors of our next Teleseminar we’ll be sharing with all of our Subscribers soon, “Mavericks do the work that matters most — the work of originality, creativity, and experimentation. They demonstrate that you can build companies around high ideals and fierce competitive ambitions, that the most powerful way to create economic value is to embrace a set of values that go beyond just amassing power, and that business, at its best, is too exciting, too important, and too much fun to be left to the dead hand of business as usual.” It’s the experience that matters most, in other words, and we’ve created a company that forward-thinking business owners and entrepreneurs go out of their way to do business with. We defy many of the familiar, dysfunctional conventions of the banking world and turn many of those on their heads. We think of ourselves as an antidote to the toxic ordinary banking culture. Our insatiable curiosity, desire to learn from all sources and our all-for-one teamwork has allowed us to unleash a disruptive presence in the marketplace, and we’re only accelerating from here.
To quote Sergey and Larry in their Letter from the Founders on the eve of their wildly successful IPO, “Google is not a conventional company . . . and we do not intend to become one.” I couldn’t say it much better myself about us. Stay tuned, it’s going to be another exciting year . . .
Happy New Year! Did you work on your goals from my first column? If not, don’t forget to go to www.504blog.com to review it while you’re still thinking about it. Best to start the New Year off on the right foot, and my free web-based gift to you is the perfect tool to help make 2007 your Best Year EVER.
As you may or may not realize, my company finances commercial real estate for owners of small and mid-sized businesses. We’re a licensed commercial mortgage lender, so we operate just like a bank, but we only offer 5 different loan products instead of 45 different products and services like ordinary lenders. We’re extremely focused at what we do, and we believe we do it better than anyone else around, but we’re still smart enough to keep striving to Better our Best.
The idea to start our niche lending firm came to me, because I believe in the power of focus. This is counter-intuitive for most businesses who usually strive to aggregate and dream of becoming conglomerates. Long ago, I gave up on trying to be “all things to all people.” That’s a formula for disaster in just about anything. Our strategy from Day One goes against industry norms, but I’ve always thought just doing what everybody else does leads to mediocrity – a regression to the mean, just being “average.” In starting a new business or making an existing one excel, you’ve got to stand-out from the clutter.
With our specialization, I knew we would either become the de facto experts or, quite candidly, go out of business (kind of the “burn the boats behind you” method of raiders striking from the sea). I won’t waste space here listing the awards and testimonials we’ve received since we started 47 months ago (visit www.504Experts.com to see for yourself), but we’ve accomplished a lot and are now rapidly growing outside of the Central Florida marketplace. We are still the only lender nationwide to LEAD with an under-utilized commercial loan product that provides the least expensive capital available to business owners wanting to purchase or construct commercial property.
What does any of this have to do with you? Well, recently in examining over 140 clients and 200 prospects, I noticed a normal bell curve forming. You remember what a bell curve is from school, don’t you? It’s the shape of a graph that indicates an even statistical distribution around the average.
This type of examination is something you might want to consider immediately in your business this year . . . at the beginning of this New Year. Where do your “best” prospects and clients come from? Have you charted the “channels” they arrive in? What does that tell you about your positioning and how you market your firm? How can you focus more of your efforts on the more profitable channels? Most businesses haven’t a clue about this . . . too busy “doing” the business to do it better, in a more strategic way. Most businesses waste a lot of resources and cause themselves more problems than necessary.
I’ll tell you our results of this exercise in a couple of weeks. In the mean time, if you’d like to sign-up to receive our monthly newsletter, join our monthly tele-seminars, and/or receive our FREE reports, simply call 407-786-5040 or email us at: info@mercantilecc.com. Let us know when we can help you or those you know finance commercial property . . . you won’t be sorry you did.
To Our (Yours and Our) Best Year EVER,
Chris
Part of my first article from our new column in the OBJ I thought might be helpful to share . . .
Welcome to the debut post of my fortnightly or bi-weekly column. I’ve been writing a blog for nearly six months (feel free to visit: www.504blog.com), but decided to write this column in an attempt to disseminate information to a wider audience on the subjects of financing, commercial real estate and business success in general. It’s primarily addressed to business owners of small and mid-sized operations – the backbone of our country and our economy.
I’ll endeavor to keep this piece fresh, informative, personal and blatantly straight-forward if you’ll continue to visit it every two weeks or so. That’ll be our “New Year’s Agreement.” After you read the front-page headlines and the business gossip blurbs on the inside cover and back page, flip through until you find this column. I will promise to keep it decidedly different and hold your interest for 400 words or so.
So Let’s Begin . . .
You’re probably reading this piece during the Holidays, quite possibly from a large stack of reading materials piling up for some time. I’ll presume that’s the case as we delve into the topic of “year-end reflections.” It’s difficult to write at the end of 2006 and not reflect upon the past 364 days. True, it’s been a rather remarkable year for our company, but to gush about it here is an exercise in self-aggrandizement that I’m not in the mood for (you can always visit our website at www.504Experts.com to read more about us there). No, I thought I’d try NOT to reflect on the past, but to focus on what should concern us more: what’s in store for 2007.
I don’t think enough businesspeople set realistic goals annually and then follow them through to completion. Sure, we all seem to make New Year’s Resolutions, but how many have we abandoned come March? With that in mind, I’m giving you one more gift this holiday season . . . a very helpful and FREE web-based tool from my good friend, Dave Dickson, in Tampa. Dave’s the owner of 21 franchised auto repair shops (Ice Cold Air) and the website: >www.mygoalguide.com. My strong suggestion, if you’re not usually still working on or accomplishing New Year’s Resolutions in July: make time to visit Dave’s site soon and seriously work on your goals for 2007. You’ll be less successful and sorry if you DON’T! Also, don’t forget to write them down, include all areas of your life (health, relationships, spiritual, career and financial), use the present tense, plan incremental steps, set dates, and visualize them occurring.
To Our Best Year Ever,
Chris
Recent article from our newsletter by Chris Hurn . . .
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Like many, this is my favorite time of year — as much for the Holidays and “attitude adjustment” many people seem to go through, as for my exhaustion soon to be relieved. I’m usually exhausted physically, mentally and emotionally this time of year from another full year of mostly highs and the occasional low. It’s a favorite time because I know I’ll soon be recharging my batteries and I know the True meaning of the season and what’s coming . . .
But due to our fears, our lack of understanding and our fundamental nature, we as a society, seem to have driven most spirituality and talk of religion OUT of our culture in recent years. I think the old, knee-jerk reaction about NOT talking about politics or religion in public has actually damaged our culture. Mature people can maintain their civility when discussing those topics . . . in fact, I would argue our democracy and our economy depends upon the frequency and depth of discussions on these very topics.
While we’ve become too concerned with “hurting others’ feelings,” our voter turnouts have plummeted, our societal knowledge of politics and business have slide, and we seem adrift, rudderless with little to no moral compass. It may be simpler and less offensive to some just to take the “Christ” out of “Christmas,” but it’s hurting us culturally. We may have a secular government, but our country was founded by Judeo-Christian principles which we’ve veered too far from. It’s perfectly compatible for business (and even politics) and religion to co-exist. Capitalists and Judeo-Christians aren’t the enemy, the enemies of capitalism and Judeo-Christians ARE the enemies.
Sure, Oprah might talk about it every once in a while. And Dr. Phil can conjure-up a line or two, if you translate his cowboy references and decipher what he’s really saying. Even in our celebrity-obsessed world, Hollyweird (err, wood) celebrities sometimes can be spiritual and/or religious. Of course, it conveniently coincides with the premiere of a movie that they just happen to be in, but . . .
For the average American, I don’t think too many of us are as truly spiritual or even as religious as perhaps we once were. Witnessing the rabbidness with which some have tried in modern times to separate Church and State, I think as a culture we’ve lost track of how truly religious and spiritual even our Founding Fathers really were. I think it’s sad most people today probably think miracles are things that only happened thousands of years ago . . . certainly NOT in 2006.
