Create your own micro capital market. How? Get more than one loan bid.
Two quotes provides something to compare so do yourself a favor by asking at least two lenders to bid for your loan business. If you have more than one competing lender then you’ll need to track the bids.
You can do this by maintaining a current loan quote matrix. Create a simple spreadsheet to track bids from lenders. Include basic information such as:
- lender name, loan officer, phone number and the date you submitted your loan proposal to the lender.
- Record any funding requirements in the bid like maximum loan to value (LTV) and minimum debt service coverage (DSCR) tests.
- Track the quoted loan amount, interest rate and fee structure.
- Look for any required reserves such as property taxes, insurance and capital improvements.
- Make adjustments to the stated interest rate to account for fees and reserves so you are comparing like loan terms.
There are many other terms in the lender terms sheet to track during the bid process. The loan quote matrix will help you monitor the loan bid process and quickly compare quotes to select a winning bid.