I have several lenders interested to finance a deal that I have under LOI, and received multiple lending proposal letters. My question for the Searchfunder collective is: when should I make the call which lender to work with? Can I wait until I have a formal term-sheet from a couple of lenders? Or choose one early on, based on the initial loan proposal, and focus on the paperwork involved with that bank?
My reasoning for working with 2 or more lenders for as long as possible, is that I suspect the rates and terms can change as we get closer to final underwriting terms, so I want to keep my options open for as long as possible. But Im concerned that it will affect my credit score or "creditworthiness" if more than one application lands in-front of the SBA. This is my first acquisition, so not sure how the final process work between me, the lender, and the SBA, and how Im affected. Also, there is already a lot of paperwork and admin involved, so another reason to select a bank earlier than later - but im willing to accept the admin pain if there is upside later on.
So to summarize the question, choose your SBA lender early, or wait as long as possible, or somewhere in-between?
(posting this anonymously since there are several lenders on this platform)