If you needed surgery, you’d want to know your surgeon went to medical school. If you needed legal representation, you’d verify your attorney passed the bar. These seem like obvious things to check because the stakes are high and the credentials exist for a reason.
Now consider the person handling your business financing. The one who has your tax returns, your bank statements, your personal financial information, and your trust. The one recommending a specific loan product that will affect your cash flow, your collateral, and your personal guarantee for the next several years.
What are their credentials? What licensing do they hold? What governing body would pull their ability to practice if they blew up your deal through incompetence or self-interest?
The answer, in most cases, is none, none, and nobody.
The business lending industry has almost no mandatory licensing requirements, no universal governing body, and no meaningful barrier to entry. A person can complete an online course on a Friday, add “Senior Funding Specialist” to their LinkedIn profile over the weekend, and be calling business owners about their financing needs on Monday. This is not a hypothetical. This is happening right now, at scale, and some of those people are calling you.
This article is about how to find out who you’re actually dealing with before they cost you something you can’t get back.
The Credential Problem Nobody Talks About
In most industries where the stakes are high, credentials exist to protect the public. Doctors, lawyers, accountants, financial advisors — all of these professions have licensing requirements, continuing education mandates, regulatory bodies, and real consequences for misconduct. The credential isn’t just a piece of paper. It’s a signal that someone has met a minimum standard and is accountable to something beyond their own judgment.
Business lending brokers operate in a different world. In most states there is no required license to broker a business loan. There is no exam to pass. There is no experience threshold. There is no body that investigates complaints or pulls credentials from people who harm clients. The industry largely polices itself, which means it largely doesn’t.
Traditional lending at least creates some natural filter. Understanding SBA guidelines, reading financial statements, calculating debt service coverage ratios, structuring deals across multiple loan products — these things require actual knowledge. You can’t completely fake your way through a complex commercial loan file indefinitely. The learning curve eventually exposes people who don’t know what they’re doing.
But even in traditional lending the bar is lower than most borrowers assume. And in one corner of the industry, the bar essentially doesn’t exist at all.
The MCA Industry Deserves Special Mention
Merchant cash advances are a legitimate financial product that serves a specific purpose in specific situations. But the industry built around selling them has a problem that goes beyond the product itself.
The barrier to becoming an MCA broker is approximately zero. I mean that literally. The training for a new MCA broker is essentially this: here is how to ask a business owner what their monthly revenue is, here is the script for when they push back on the rate, and here is your login to the funding portal. That’s largely it. The product sells itself on speed and accessibility. The broker’s job is mostly just not to lose the deal before it closes.
What this means in practice is that the MCA space attracts a lot of people who want commissions without wanting to learn a craft. Someone could be working at a pizza shop on Monday and calling you about a $300,000 financing request on Tuesday. No exaggeration. No meaningful training between those two events. Just a phone, a script, and access to capital that can do real damage if it’s placed incorrectly.
We have seen the aftermath of this countless times. Business owners who were put into MCA stacks they didn’t understand, carrying effective APRs that were never disclosed clearly, with daily payment pulls that drained their operating accounts and left them unable to make payroll. The broker who placed those deals collected their commission and moved on. The business owner is still dealing with the consequences.
This is not an indictment of every MCA broker. There are people in that space who know what they’re doing and place the product responsibly. But the ratio of competent to incompetent, of client-first to commission-first, is not favorable (this is putting it kindly). And the stakes of getting it wrong are too high to assume you got one of the good ones without checking.
The Five-Minute Background Check
Before you go any further with anyone handling your business financing, spend five minutes doing your own research. This is not complicated and it surfaces more than you’d expect.
Google them and their company
Start with a basic search. Their name, their company name, their company name plus “reviews” or “complaints.” Look at what comes up. How long has the company been around? Is there any history of complaints or regulatory actions? Does anything feel off about what you find or notably absent in terms of any real presence?
Look at their website
A professional website is not proof of competence. But a sloppy website is a signal. If the site looks like it was built in an afternoon, hasn’t been updated in years, has broken links or generic stock photos and placeholder text, that tells you something about how seriously this person takes their professional presentation. Sloppy work on the thing they control completely tends to predict sloppy work on the things that matter.
No website at all is its own signal. In 2026, a professional operating in any financial services capacity who has no web presence either doesn’t value credibility or hasn’t been around long enough to build one. Neither is reassuring.
Check their email address
This sounds minor. It isn’t. A broker corresponding with you about a $500,000 financing transaction from a Gmail address is not running a serious operation. A professional email address tied to a real domain is a basic minimum. If they haven’t bothered to set one up, ask yourself what else they haven’t bothered with.
Look them up on LinkedIn
LinkedIn is imperfect but useful. Look at how long they’ve been in the industry. What did they do before this? Is there a coherent career history or does it look like they landed here recently with no obvious path that got them here? A profile showing 14 months in business lending following a completely unrelated career, with a certification from an online course as the only credential, is information. Use it.
The Questions That Separate Real From Fake
Background research tells you what’s on paper. Direct questions tell you what’s actually in their head. Ask these before you hand over a single document.
“Walk me through your last two deals?”
Not in general terms. Specifically. What was the loan type, what was the structure, what challenges came up during the process, and how were they resolved. Someone who has actually closed deals can answer this without hesitation. Someone who is newer or who closes deals without really understanding them will get vague fast. Listen for specificity. Vague answers to specific questions are a red flag every time.
“How is this loan going to affect my debt service coverage ratio?”
You might not have ever heard the term debt service coverage ratio before this moment as you read it. That is completely fine. You’re a business owner, not a lender. But the person handling your financing has no such excuse. Any broker worth working with should be able to explain in plain English how the debt service on this loan affects your overall cash flow picture and what your DSCR looks like before and after. If they can’t answer this question clearly and quickly, they don’t understand the fundamental impact of what they’re selling you. That’s disqualifying.
“Why this product and not _______?”
Ask them to explain specifically why they’re recommending this particular loan product for your situation. What alternatives did they consider and why did they rule them out? A knowledgeable advisor can walk you through that reasoning. Someone who only knows how to do one or two things, or who is recommending the product that pays them the most, will struggle to give you a satisfying answer to this question.
“How much are you making on this deal and will I see it in writing?”
This is the most important question on this list. A legitimate advisor answers it without blinking. Here is what I make, here is how, here is where it shows up in your loan documents. The amount, the source, and yes — in writing.
Anyone who hedges on this question, gets vague, tells you that’s just how the industry works, or says the compensation is between them and the lender is giving you the only answer you need. Transparency about compensation is not an unreasonable request. It is a basic expectation. A broker who won’t meet it is a broker who has a reason not to.
Red Flags When Your Working With Someone
Sometimes the signals don’t show up until you’re already in the process. Here’s what to watch for after the relationship has started.
- Pressure to decide fast. Legitimate financing opportunities rarely evaporate overnight. If someone is pushing you to commit before you’ve had time to think, ask questions, or get a second opinion, that urgency is manufactured. It serves them, not you.
- Vagueness on timeline. A professional who has done this before can give you a realistic timeline for your loan type. If every question about timeline gets a non-answer, that’s either inexperience or evasion.
- Can’t explain why they recommended this product. If you ask follow-up questions about the recommendation and the answers get circular or defensive, that’s a problem. You should be able to understand exactly why this product was chosen for your situation.
- Won’t put things in writing. Compensation, timeline expectations- legitimate professionals are not afraid of paper trails. Reluctance to document anything is a serious red flag.
- Disappears after submission. Some brokers are great at the front end of a deal and completely absent once the file is submitted. If communication goes dark after you’ve handed over your documents, you’ve learned something important about how they operate.
- They keep pushing you to take more money. Whether it’s during your current deal or the moment it closes, a broker who keeps pushing you to take more than you asked for is in it for himself, not you (in MCA land this is called stacking) and it will kill your business.
- The bait and switch. This one is rampant and it needs to be said plainly. You came in asking for an SBA loan. Somewhere in the process the story changes – “take this short-term money first to prove yourself to the lender then we can circle back to the SBA loan.” That is never how it works in the real world.Ever.
What Qualified Actually Looks Like
It’s worth flipping this around. Here’s what working with someone who actually knows what they’re doing feels like from the first conversation.
They ask about your objective before they mention a product. They ask to see your financials before they tell you anything looks good. They give you a realistic picture of your situation including the parts that are going to create challenges. They explain their compensation clearly and without being asked twice. They tell you what the timeline looks like and why. They are reachable throughout the process and proactive about updates. And if the deal isn’t right for you, they tell you that too – because their business model is built on long-term relationships, not individual transactions.
That last point is the real tell. A broker who is thinking about commissions is thinking about closing this deal. An advisor who is thinking about their reputation is thinking about whether this deal is actually right for you. Those are different motivations and they produce different outcomes.
You built your business by getting good at something. You hired people who were good at their jobs because you knew the difference between someone who could do the work and someone who just said they could. Apply that same instinct here. The person handling your financing deserves at least as much scrutiny as anyone else you’ve ever brought into your business. Ask the hard questions. Do the five minutes of research. Trust what you find. Your business is worth that much.
