Use of the word Pre-Qualified
/ BBF
Recently as State President of BBF I have received complaints from BBF members that use of 'Lender Pre-Qualified' has created a problem or is being misinterpreted. Therefore I wanted to clarify what 'Lender Pre-Qualified' stands for.
'Lender Pre-Qualified'is only to be posted on a listing if the listing agent has a letter or some kind of written authorization on file in their office from a licensed lender who has pre-qualified the business for a loan. This letter must have been written within the last 6 months. It must be a third party source for the financing. It could be an SBA Lender, a Commercial Bank or a Licensed Lending Group.
Most business brokers in today's economy are trying to operate more economicallyand as a standard practice are starting to get their buyers or prospects pre-qualified by lenders before showing them several businesses. However, the lender the selling agent is working with may not be the sameentity that the listing agent has involved in the transaction. Some brokers have started the practiceof calling the listing agent to find out who the lending institution is that pre-qualified the business as they would like to have their buyer pre-qualified by the same lender before they proceed. It makes the deal easier to put together.
If the business is going to be financed by the seller 'Lender Pre-Qualified'CAN NOT be used. If the SELLER is doing the financing there is no third party financing involved.
Please adjust all of your current listings posted in BBF if you have third party financing involved.
Thank you,
Bert Risdon