Low
Credit Commercial Finance
Poor
Credit Business Lending
In
recent years commercial lending has developed and become
more open minded and flexible
regarding
commercial lending underwriting. The main clearing banks
who are the prime source of commercial mortgages are very
strict regarding adverse or bad bad credit when applying
for a business loan.
This
is because potentially business lending is very high risk
with many new and existing businesses failing within the
first five years trading period. It makes more sense and
company profit to only lend to businesses that after careful
consideration and checking turn out to be low risk.
This
means that if directors, business owners or the business
itself has had a poor credit history then generally this
is not the type of business they wish to lend to.
However
new lenders have now come into the lending market and
will potentially consider lending to business who have
had past credit problems. This might include CCJ,
mortgage arrears, default payments and missed loan repayments.
Generally to protect themselves they will reduce the loan
to value of the mortgage offered depending on the degree
of bad credit. Commercial lending can be regulated or
unregulated business depending on the individual circumstances
of the case.
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