LAS VEGAS (KSNV) — Small business owners who wait until a cash crunch hits to think about financing can put themselves in a tougher spot than they need to be, according to Josh Haldeman, chief lending officer with Create Credit Union.
Haldeman said the best approach is to prepare before money becomes urgent. That includes having tax returns completed, keeping financial statements in order, and building a relationship with a local lender.
“That’ll help you so that when things are urgent, they already know you and they can help you in a more rapid manner,” Haldeman said.
Haldeman also outlined how an SBA 504 loan works for business owners looking to purchase property, such as a building or warehouse. He said the process is typically a standard loan application that Create Credit Union tries to streamline.
“A lot of people think, oh, this is a hard thing, and it’s confusing,” Haldeman said. “At Create Credit Union, we’ve done a really good job of making it a simple process.”
Haldeman said Create Credit Union was the number one SBA lender in the state of Nevada last year, adding, “A credit union has never done that, and so we are very proud of that.”
One advantage of an SBA 504 loan, he said, is a lower down payment compared with traditional financing.
“You typically come in with a 10% down payment as opposed to a 25% down payment,” Haldeman said.
As for timing, Haldeman said the appraisal is often the longest part of the process and typically takes about three weeks. He said having an existing relationship with a lender can help speed things up because underwriting is easier when financial information is already on file.
He said that Create Credit Union’s loan officers also take a consultative approach, including reviewing cash flow and identifying potential weak spots.
“Think of them as an extra member of your team that you don’t have to pay,” Haldeman said.
Haldeman said credit scores matter, but they are not the biggest factor in whether a business can qualify.
“Your credit score is important, but it is by far, it is not the most important thing,” he said.
He said cash flow and collateral are key, and that borrowers who have had “some hiccups in the past” may still be able to move forward, depending on the overall financial picture.
For business owners ready to begin, Haldeman said the first step is to contact a loan officer at Create Credit Union and start the conversation about what they want to do, including buying a building.
“They’ll walk through every step of the way, and they’ll make it as easy as possible,” he said.
