Lance Hood (FranPro): 0:05

Hey everybody, welcome to the Franpro think tank. Today I have Brian Peart from Commercial Capital. Brian, welcome to the call.

Brian Peart (Commercial Capital LTD): 0:18

Thanks.

Lance Hood (FranPro): 0:20

Well, brian, can you briefly tell us a little bit about yourself and your background? I know that I've worked with you for a long time and I've really, really been very happy with the results I've got working with you, and I just wanted everybody else to have a chance to meet you.

Brian Peart (Commercial Capital LTD): 0:36

Sure, sure, lance. Well, I'm Brian Peart. Commercial Capital and Next is Financial. We started I started the company back in 1995. We've been doing. We started as residential, now we're doing commercial. We launched our commercial in about 2000 and now that's all we do. And we've grown to where I probably produce more closings per month than any single loan officer in the country. So we're growing.

Lance Hood (FranPro): 1:05

So, Brian, what would you say? Your specialty is because some people are like a loan is a loan.

Brian Peart (Commercial Capital LTD): 1:13

Well, yes, the documents you sign at the end are a loan. But whether you get approved or denied or any of that, that's all up to who you're choosing. And the thing with us is most of the deals we get have already been denied by a bank, even SBA, and then we take them, get them approved, because what people don't understand is the SBA didn't deny the borrower that bank did, they just went with the wrong bank. We take it and get it done, and usually at the exact same rates that they were getting from the bank, but we get it to the closing table.

Lance Hood (FranPro): 1:49

So I remember one time you told me that some people get denied and then they come and work with you and you actually get the deal done, and for a lower rate.

Brian Peart (Commercial Capital LTD): 1:59

Yeah, that's happened plenty of times. Probably about 80% of the business we closed got denied somewhere else and then came to us and got closed. We do a lot of startups, which a lot of banks don't want to do. Probably 40% of our business is startups. So we're doing a lot of deals that I mean they're good deals, they're good borrowers, they just a lot of banks don't like them because they don't have collateral or they don't have this or that, and we just find a spot that works for them.

Lance Hood (FranPro): 2:29

Well, I remember you even told me about a few of the bigger brands that you helped them get started. You certainly had a few units and you sourced the banks, because sometimes one bank doesn't want to take and open up a whole lot of locations of some new brand, so you have to source it from different banks just to make it work. Can you share some of those stories?

Brian Peart (Commercial Capital LTD): 2:49

Sure. So you know, I started doing franchises back in maybe 2011 when Firehouse Subs was trying to grow across the country. They were big in the Southeast but they didn't have any presence out west and they were having trouble getting financing. And so, as they continued out west, I kept finding sources for them through Colorado into California and helped them grow into a nationwide brand. We had a lot of success with that. It was a lot of fun for many years.

Lance Hood (FranPro): 3:20

And what would you say? You know for some of the biggest challenges that people experience, that you work with.

Brian Peart (Commercial Capital LTD): 3:30

You know, lance, I think the biggest thing is that you don't know what a bank really wants to do, unless you send loans to that bank and you see how their credit committee comes about. Because the loan officer who's in the bank branch may not even know they may only be working there a few weeks and not even really know what that bank is doing and so because of that you might be banking at a bank and you think that bank will naturally do your loan, but they actually don't like deals with no collateral or they don't like deals with credit scores of 650 and you don't know that. So what we do is we kind of take the strengths of the borrower, their credit, their cash for their collateral, and match them with the lender that keys in on those strengths, so that they're kind of fitting the square peg with the square hole and it has a lot higher success rate of closing than just going and applying it. Whatever bank you think is a good bank just because they've done good holding your money in a CD, you know.

Brian Peart (Commercial Capital LTD): 4:30

It's not be very good at SBA loans or any other type of loan.

Lance Hood (FranPro): 4:34

So yeah, I have found the same thing with a lot of people. They feel more. I think it feels more comfortable to try to work with a local bank that they've worked with for years or done their checking with and or their home mortgage. But it doesn't seem to be that those banks all say, sure, we can do it. But I've seen a drastic amount of them not able to actually pull it off and have an end starting out excited and in the end just kind of saying sorry, and then the person thinks that they don't qualify for a loan. But it's just the bank that they went with because I think it's a security issue, it feels better.

Brian Peart (Commercial Capital LTD): 5:16

Yeah, the statistics are pretty stunning. Most banks will ultimately deny 50% of the applicants that come their way. So even if you get a letter from the rep a letter of interest, what it's called it may get denied in credit committee, which is when the money really is put out there once they give you a commitment letter. So really you're at a disadvantage as a client or a customer because you don't really know if that bank likes your type of loan or not. Just because they like you as a person and you're good friends with Mary Lou doesn't mean that Bob on the credit committee is going to do the loan, no matter how much they like you.

Lance Hood (FranPro): 5:59

And I talked with somebody who said that. He said that a lot of banks might even have a portfolio, so they're trying to build a certain amount of different kinds of loans and if yours is out of their portfolio, then they can deny. You Doesn't mean that you don't qualify for a loan. You're not a good candidate for a loan, the business isn't good for a loan, but they're looking for more mortgages, different types of things.

Brian Peart (Commercial Capital LTD): 6:24

Sure, and they may change their guidelines if they fill up. So, like, a bank that did hotels two months ago may be full on hotels and they won't do hotels anymore, even if the hotel is really, really strong. So it just depends on that bank's portfolio, like you said, and what they're looking for.

Lance Hood (FranPro): 6:43

So do you have any other examples of businesses and you don't have to give names if you don't want to but that have had franchisees that just struggle and then you were able to take those over? Because that's one of the reasons I started working with you, as I had some loans tonight from several of the major franchise lending companies and they just couldn't get them done. And I went to you and I don't think you've ever had a deal that didn't get done, which I don't think that anybody else can say that in this industry they work with a lender who has never not been able to get a deal done, and I can tell you that my experience with Brian is he's never not been able to get a deal done.

Brian Peart (Commercial Capital LTD): 7:24

Okay, but there are deals that I would say yeah, for you, you just a better borrowers, right so but but yes, I have a very high poll through. You know I've got lots of examples. You know, just last month I closed a loan for a guy who was starting a restaurant and it was about a $2 million deal and he was with a bank for 11 months and Right before the closing they denied his loan because one of the One of his co borrowers. The reason they were doing the loan, apparently, was that co borrower had a lot of collateral. Well, his collateral was Bitcoin and it dropped when the Bitcoin thing right a few months ago his, his portfolio went from a million dollars of worth to like 100,000.

Brian Peart (Commercial Capital LTD): 8:13

And they denied the loan. So I took the loan, got it done. I can do loans up to 5 million with no collateral so I got it done. He closed and he's he's. It was a good loan. He had experience. He already had one restaurant open but, but he could not, but he had no collateral and it was a $2 million loan and most banks just won't go that high without collateral.

Brian Peart (Commercial Capital LTD): 8:34

So that was one, you know, I did Closing this week alone. That's kind of amazing. It's. It's a borrower had an insurance company and he they're very successful to make good money and they did it by creating like an algorithm on their computer, right but? But they create an algorithm that that maximizes the cash flow of insurance agencies. They wanted to create an application and then sell that application to other insurance companies and they needed about 3 and a half million to get Almost seed money for that, that application. It was almost all working capital and and those are incredibly tough to get done and and actually of the hundreds of lenders I know there were only two that might have considered it and we got it. We got it done, we got it approved, we're closing it this week and it's almost all working capital for the for the creation of this app.

Brian Peart (Commercial Capital LTD): 9:36

The reason it works is the business itself supports the debt. So even though it's a new application, the business supports the debt. I mean almost every loan. In my pipeline there's another one local, local restaurant, you know just business only Already open, but the borrower went with. None of the local banks wanted to do it because, again, she didn't have any collateral, it was just the restaurant Business being bought, not the real estate. And you know we got it approved, got it done, and it's actually a barbecue joint that I go to every once in a while. So it's kind of neat to do a loan for a place that you, you know, you frequent, which I don't always get to do. So that was kind of cool.

Lance Hood (FranPro): 10:19

Right. Well, if I didn't know you and I was hearing this, I might think that we're talking about a guy who can get loans done regardless of the the the ability to qualify for a loan of the borrower. So we're not looking at taking people who shouldn't have a loan and finding a way to get them a loan. We're taking people who qualify for a loan but they just went to the wrong bank and we can find a bank, brian can find a bank that makes sense and will do the loan. And I have again, I'm sure that there's people that could not qualify and you couldn't help them, but so far I've brought people to you and I've never had somebody who was turned down, so it's just been impressed with that as a rule of thumb, what's kind of like a range of how long it might take for someone to get funded.

Brian Peart (Commercial Capital LTD): 11:15

So we do have our own private money so we can fund deals with our own money instead of going some of the channels like SBA and that can close in less than 30 days, but SBA loans are typically 45 to 60 days and that really depends on how quickly you get your documents in. That's one of those things you can do to really help your process out.

Lance Hood (FranPro): 11:36

Well, and I know that you also don't do loans under 250,000, correct, that's correct. So about 250 to 5 million is the sweet spot.

Brian Peart (Commercial Capital LTD): 11:46

Yes.

Lance Hood (FranPro): 11:48

Yeah, and what are some common mistakes that you see when people are trying to use services like yours?

Brian Peart (Commercial Capital LTD): 11:56

You know, I think the biggest thing that people do is they call me last Again. They go into these banks or whatever and they go online and they try these things and there's no real regulation in our industry, unfortunately, so you don't know what you're getting. You know, if you call me first, I'm gonna get on the phone, I'm gonna talk about your deal, I'm gonna figure out if you can even qualify, and if you can qualify, then I'll have you a pre-approval within 24 hours. So you'll know how much you can get approved for and you know exactly what you can do. That gives a lot of peace of mind, you know, on a deal. And if you can't get and if for some reason, let's say, your credit score is too low to get approved, I can give you tips on how to get that up, or I can at least strategize with you where you can qualify in six months. You know.

Lance Hood (FranPro): 12:59

You know almost anything can be overcome if you have six months you know Right, if you're persistent and you wanna follow instructions and stay in the process. It definitely seems like it takes longer, based on the borrower doing the tasks that they've been given to do.

Brian Peart (Commercial Capital LTD): 13:18

Yeah, so you know you said what's something that can shorten it. If you have to understand that you're gonna get asked a bunch of questions initially, then at approval and other bunch of questions, then at loan commitment, you're gonna get closing checklist, and so that's at least three times when you're being asked for documents, and if at each one of those times it takes you one or two weeks to get the documents in, then you're adding two weeks plus two weeks plus two, you're adding six weeks to the process. All of a sudden it's not 60 days, it's 75 or 90 days, and the process didn't slow on the lender's side. You just took so long to get it done. I've closed SBA loans in 40 days, but the borrower gets the stuff to us the same day. That's the only way to get it done that quickly.

Lance Hood (FranPro): 14:04

Yeah, I have seen clients drag it out and I always tell them the most fun part is talking to the franchise. I said getting the loan is not gonna be the most fun part with all the documents.

Brian Peart (Commercial Capital LTD): 14:19

Yeah, franchise deals too, because they're looking for lease space and stuff. That's part of the process, and a lot of good franchises will help them with that process. But you've got to find a lease. I can have it totally approved. But if you don't have a place to move into yet, I can't close your loan yet, right? So that could take. I've seen lease negotiations take months. I'm just waiting for them to finish and then we can close. That's usually the case.

Lance Hood (FranPro): 14:49

Yeah, and I've seen where some franchises they don't require people to have an office. But if you don't get in there early and let the bank know that they don't need an office to start, then they're just to not disturb loan. They're doing all this extra stuff that drags it out and takes forever. So some of that stuff if they think about that in advance, that can be put out there and drastically shortened the loan time.

Brian Peart (Commercial Capital LTD): 15:14

That's right.

Lance Hood (FranPro): 15:15

Yeah, any other things that you think that could help people get better or quicker results when they're looking for a loan?

Brian Peart (Commercial Capital LTD): 15:23

I Think it doesn't hurt to Give me a call. We you're gonna provide a link.

Brian Peart (Commercial Capital LTD): 15:29

I believe that they can mm-hmm to and set up a call with me because I can talk you through. I mean, I've started my own business and I've helped hundreds and hundreds of people do their own Loans so I can get you pre-approved, I can consult with you, etc. And it and I can do that for free, it won't cost you anything for that advice. And it would be Prudent to get some good advice like that, because I really do a lot of loans and and the more you do, the more you learn, the more you know, and so you just like a sponge, just getting it all in right and and and so I can provide that knowledge to someone. I think that would be a great step one, rather than wait until some banks deny you and then call me. Call me first, man, I'm, I'm gonna. The Lord has gifted me with the ability to, to teach and consult and I'm gonna give you Good advice.

Lance Hood (FranPro): 16:22

I will yeah, and I think I've even introduced you to some franchise companies and and they've seemed to be extremely happy. So definitely the one thing that you've told me since day one is that you get frustrated that people come to you at the end to Fix things that are broken. Versus just sending you their clients from day one so that you could have the easy ones. You always end up getting the hard ones, it's like right. Why do people keep sending them to the people that get them denied when and then send you the denied ones when they Could send you all of them?

Brian Peart (Commercial Capital LTD): 16:52

Especially when I'm gonna give them the same rate or better. I mean, you're gonna get a better deal want and the advice and everything else and close it. It's, it's not wise to take the risk going somewhere else. In my opinion, that drags it out.

Lance Hood (FranPro): 17:10

All right. Well, thank you, brian, I really appreciate you for everyone who's listening. I'd say you give Brian a call and check him out. I've worked with him for years, been very happy. I've never had a bad situation. I've seen him go over and above and practically every situation and even some things I haven't. He's done some incredible things for people that I've seen nobody in the industry do. If you want to work Brian go here https://Franpro. vip/GoCommercialCap Brian Brian, I really appreciate having you on the call. Thanks, thanks for joining us.

Brian Peart (Commercial Capital LTD): 17:58

I appreciate it. Thank you, have a good day.