Analyzing the supposed wisdom of commercial loan experts is one of the most difficult tasks when solving a small business finance problem. Several conflicting opinions will inevitably emerge in any attempt to obtain advice about business financing. In such cases it is frequently helpful to apply the wisdom from earlier generations, especially when it provides a simple and straightforward lesson that is relevant to the current circumstances.
The Watergate break-in four decades ago resulted in a constitutional crisis. Out of that complex political and criminal drama, an enterprising pair of journalists (Bob Woodward and Carl Bernstein) eventually cracked the case by a number of skillful techniques. They did not accomplish this feat in isolation and had substantial help from others. The assistance included such wise advice that they ?follow the money? when investigating a complicated puzzle that was made even more confusing because so many parties were engaging in intentional deception at almost every turn.
In the world of small business finance, there appear to be a number of instances in which the wisdom of ?following the money? could be very instructive. One event that comes to mind involves the ongoing mystery of what happened to the trillion dollars given to banks which was supposed to energize commercial lending to small businesses but which instead cannot be accounted for by most bankers when they are asked about what they did with these funds. This question does continue to keep coming to the surface probably because of the current poor state of commercial mortgage financing and business loans.
When small businesses are seeking help with working capital and commercial mortgages, they should consider a ?follow the money? mindset. In the simplest form of this guideline, borrowers should not hesitate to ask a business lender for detailed information about their actual commercial loan activity during the past several years. Their failure to be forthcoming with this data will be just as illuminating as their willingness to openly share how actively they are really lending to small businesses on a regular and ongoing basis.
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Source: http://www.jiaqin.org/commercial-loan-help-for-small-business-owners/
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