Mistakes borrowers often make:

1. Not thoroughly researching options

Borrowers should do their due diligence and review financing options from different banks and different lenders.

2. Failing to have a definite plan

Lenders want to see that there is plan for the money that they are lending to a borrower. They also want to know the time frame of the project. These factors affect how and how much money is lent to the borrower.

3. Not having cash ready to put into the project

Before the borrower applies for a loan they should be prepared to invest some cash initially. It is important for lenders to see that a borrower is prepared to take some risk and invest their own money into their own project.

4. Not reviewing the balance sheet

A borrower should be very familiar with their balance sheet.  They should analyze their cash flow and liabilities to make that sure that while paying off the loan they are applying for they will still have enough money to complete the project.

5. Failing to negotiate the best deal

Real estate deals require negotiations.  Negotiation is a part of the process.  It is also form of communication.  It is vital that you negotiate and communicate with your lender to get the best deal.  As the lender understands your project more fully negotiation can take place.

6. Going straight to a familiar lender

It is important to shop around and try new lenders.  This is also a part of the negotiation process. The borrower should check other possibilities at other banks and with other loan officers to get the best deal.