Most of a brokered deal is negotiable: the broker's own fee, the lender's origination fee, the rate or factor rate, the term, prepayment terms and some collateral requirements. The best leverage is a strong, complete file and a competing offer. Ask politely, ask in writing, and ask before you sign.
Good brokers expect this conversation. Negotiating well is part of what they do for you with lenders, and they respect owners who know the numbers.
What you can negotiate, and with whom
| Item | Who controls it | How negotiable |
|---|---|---|
| Broker fee paid by you | Broker | Often negotiable |
| Lender-paid broker commission | Lender and broker | Indirectly, through the rate |
| Origination or underwriting fee | Lender | Frequently, on strong files |
| Interest rate or factor rate | Lender | Yes, with a competing offer |
| Term length | Lender | Yes, within the lender's limits |
| Prepayment penalty or discount | Lender | Sometimes |
| Collateral and personal guarantee | Lender | Sometimes, on larger or stronger deals |
| SBA rate | Lender, capped by SBA | Yes, below the SBA maximum |
Your broker is your negotiator with the lender, so the order matters. Settle the broker's own compensation first. Then ask the broker to push the lender on rate, fees and terms.
Start with how the broker is paid
Brokers are paid by the lender, by you, or both. NerdWallet puts broker fees across the market at roughly 1% to 15% of the loan amount, with SBA loans at the low end and merchant cash advances at the high end. Ask early:
- Are you paid by the lender, by me, or both?
- What is the amount in dollars, not just a percentage?
- Is the lender's payment to you built into my rate or factor rate?
- Is any fee due before I have a written offer?
Once you know the full picture, negotiation is simple. If the broker earns a lender-paid commission, a separate fee from you is the first thing to discuss. If the broker charges you directly, ask whether a lower fee is possible in exchange for a quick decision or a referral. Verified entries on the register show fees in writing, which makes this conversation easier.
Avoid any broker who wants an upfront fee before you have an offer in hand. Paying after funding, from the proceeds, is standard.
Negotiating the lender's fees
Origination fees vary widely. NerdWallet reports conventional bank origination fees of 0.5% to 1%, and online lender fees of 1% to 10%. On a $250,000 loan, moving an origination fee from 3% to 2% saves $2,500 at closing.
Ask your broker to request:
- A lower origination fee, or a waiver on a renewal
- Removal of documentation or "processing" fees that duplicate origination
- A lower rate instead of a lower fee, if you plan to keep the loan to term
- A lower fee instead of a lower rate, if you plan to pay early
Negotiating rate and factor rate
The rate moves most when a lender knows it has competition. A second written offer is your strongest tool. Small changes add up:
| Change | On this deal | Savings |
|---|---|---|
| Factor rate 1.30 to 1.27 | $100,000 advance | $3,000 |
| Factor rate 1.35 to 1.30 | $150,000 advance | $7,500 |
| Origination 3% to 2% | $250,000 term loan | $2,500 |
| Origination 2% to 1% | $500,000 equipment loan | $5,000 |
The factor rate math is direct: a $100,000 advance at 1.30 repays $130,000, and at 1.27 it repays $127,000.
For SBA 7(a) loans, the SBA sets maximum spreads over the base rate: 6.5% for loans of $50,000 or less, 6.0% from $50,001 to $250,000, 4.5% from $250,001 to $350,000, and 3.0% over $350,000. Lenders may charge less. Ask your broker whether the lender is pricing at the cap and whether it will come down.
Negotiating terms, not just price
Sometimes the better win is in the structure:
- Term length. A longer term lowers the payment. A shorter term lowers total cost. Choose deliberately.
- Payment frequency. Weekly instead of daily debits can ease cash flow on a merchant cash advance.
- Early payoff discount. On an advance, ask for a written discount if you pay the balance within a set window. Without one, paying early saves nothing.
- Prepayment penalty. On term loans, ask whether the penalty can be removed or step down over time.
- Collateral. Ask whether a lien can be limited to specific equipment instead of all business assets.
- Personal guarantee. On strong files, ask whether a spouse can be released, or whether the guarantee can be limited.
SBA loans have their own rules
On SBA 7(a) loans, any compensation you pay a broker or packager must appear on SBA Form 159. The form states that compensation "must bear a necessary and reasonable relationship to the services actually performed" and cannot be contingent on loan approval. If total compensation exceeds $2,500, it must be itemised. The lender itself cannot charge you a broker, commission or referral fee. If the SBA finds an amount unreasonable, the agent must reduce it and refund the excess.
That makes SBA fees a fair topic to raise directly: ask for the itemised breakdown and what each line covers. See SBA Form 159 explained.
How to ask
- Ask in writing. Email creates a record and gives the broker something to forward to the lender.
- Be specific. "Can you get the origination to 2% or the rate to 11%?" works better than "Can you do better?"
- Show the competing offer. A written offer from another lender carries real weight.
- Offer something back. A quick signature, autopay, or a larger first draw are things lenders value.
- Know your walk-away point. Decide your maximum cost and payment before the call.
When not to push
A deal that only one lender will do, on a tight timeline, has less room. Pushing hard on a narrow approval can cost you the approval. Ask your broker plainly how much room there is. A broker who works with you every week has every reason to tell you the truth, because your next deal matters to them too.
Ready to compare offers from brokers who compete for your file? Start with the match form, or read broker fee vs lender-paid commission first.
Questions owners ask
Can I negotiate a broker's fee?
Often, yes, especially when the broker also earns a lender-paid commission or when your file is strong and quick to place.
What is easiest to negotiate on a merchant cash advance?
The factor rate, the term length and any early payoff discount. A small change in factor rate is real money on a large advance.
Can a broker charge me a fee on an SBA loan?
Yes, if it is disclosed on SBA Form 159 and bears a reasonable relationship to the services performed. The SBA can require excess fees to be refunded.