I wish I xould
I wish I could explain the questions they ask! The VP we are working with has always said he was optimistic that they could get this deal done for us and each trip to the loan committee has come back with more questions. We have had to educate them all about BnBs and why many have prospered during this pandemic vs many hotels. Our restoration project of the school is no small project. When we started looking for funding, the total project cost was about 1.7M, pre covid. Our latest updated cost structure added about $350,000 to the total. We have invested almost $500,000 of our own money. Our credit scores are north of 700, cash reserves are a little low but we have close to $700,000 state & federal tax credits when the project is complete that can be monetized. Because of the cost, the SBA/USDA are our best options. Our projected revenues are conservative and inline with the area, we worked pretty extensively with our SCORE advisors to put these figures together. Even with the increased costs, our debt service ratio is greater than 1 for the first year and gets better in yrs 2 & 3. Our local smaller banks, where we started are mostly agriculture/home lenders and have no experience in hospitality lending. The one local bank who really saw this project as a exciting project and was in until he approached his loan committee and found out that even if they wanted to, they could not lend to hospitality venues, something in how their bonding is structured.I'm a little stumped...why would they ask a question like that? Usually its..how much equity do you have? How's your credit? How much cash reserve do you have? How much do you have to put down? Show me the business plan. I had 0 experience in the hospitality business but successful in other endeavors. I have always used smaller local banks and actually have relationships with 2..