Need funds to startup or expand your business? Follow these steps:

A lender looks at a loan request in three sections known as the "three C's". They are:

• Credit. Did you pay previous lenders back as contracted?
• Capacity: Can you afford to pay back this loan?
• Collateral: If you don't pay back the loan from what asset can the lender recover their principal?

Step one is:

1. Identify your strength and weaknesses in the "3 C's". Do this as would a lender - with a very critical eye. Identify your loan to value ratio and your debt service coverage ratio. If you have reason to believe that you credit is less than sterling, get a copy of your credit report including your credit score

Each lender has different criteria with the cost of the loan being higher as your strength in the "3 C's" is lower. Step two is:

2. Identify lenders who lend to your level of borrower and to your industry type. Call lenders to get their criteria. Learn about the SBA 504 program and 7A loan guarantees. Find who others in your industry have used for financing.

If there is a gap (not a canyon, just a gap) between your borrowing ability and lenders criteria, a loan broker may be able to help. They spend their working hours finding second and third tier (more aggressive and more expensive) lenders and establishing relationships with them. They can act as a salesperson for your project in ways that you as a principal cannot. Step three:

3. If you cannot find lenders on your own, consider hiring a commercial mortgage broker. Be careful - in many areas there is little or no protection under the law for commercial transactions. While a small upfront fee for out of pocket expenses is reasonable, shy away from any that want large upfront payments. If they can do the deal they will be paid very well at settlement. If they can't do the deal they shouldn't be taking your business at all.