8. What impact can due diligence (underwriting) have on the transaction structure?

Keep in mind that a lender's underwriting staff will always look at the worst-case scenario for a given financing and they will always seek to ensure that the structure of the transaction (the terms and conditions under which the lender will provide the debt) takes into account the best ways to protect the lender's interest. That does not mean that all lenders will structure every transaction using all possible permeations of protection against loss. That is what competition is all about. As a buyer of financing, you should seek the lender that can best meet your needs, and that can often come down to which lender will offer the best structure, in addition to the best rate and the best repayment terms, from your perspective. It is always a good idea to shop around for financing.

9. Are interest rates the only measure to consider?

The answer is a resounding no. Interest rates are important, but they are not the only measure of whom a borrower should select to do their financing with. Experience, trust, and other transaction structure elements are important factors to consider. Loans that require guaranties generally have lower interest rates than loans that do not require guaranties. It is necessary to assess the trade-offs for having a limited or nonguarantied structure with a lender. It can definitely come down to dollars and centsyou can, and should, calculate what the premium cost is for having a nonguarantied (personal and corporate) transaction structure. Are the dollar savings worth it? Is the dollar cost worth it? Assess the trade-offs and make an informed decision.

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