In today’s commercial financing landscape, one of the most frustrating challenges for borrowers isn’t finding a lender — it’s figuring out who’s actually a lender in the first place.

Every economic cycle brings a wave of new “capital sources,” “funds,” “underwriters,” and “investment groups.” Some are legitimate. Many are not. And a surprising number are simply brokers pretending to be lenders, hoping to secure a mandate so they can shop your deal around to the real sources of capital.

The result?
Borrowers waste months, lose deposits, and watch opportunities slip away while chasing capital that never existed.

After nearly three decades in this industry, here’s the truth:

Real lenders are rare. Pretend lenders and shadow brokers are everywhere.
Your job is to know the difference early — before you waste time, money, or credibility.

This article will help you do exactly that.

1. Real Lenders Disclose Their Capital Source. Pretend Lenders Dance Around It.

A legitimate lender can clearly explain:

Where their capital comes from (private fund, bank, family office, institutional pool, etc.)
Who makes the decisions
What their criteria are

Pretend lenders speak in circles:

“My group.”
“Our investors.”
“My partner with deep pockets.”
“We’re well-capitalized.”

If you push for specifics and the answer gets vaguer, you’re not talking to a lender.

2. Real Lenders Ask for Documents. Pretend Lenders Ask for Fees.

True lenders need actual underwriting documents:

Financials
Appraisals
Pro formas
Business plans

Why? Because they’re assessing risk.

Pretend lenders skip underwriting and jump straight to:

“Due diligence fees”
“Underwriting retainers”
“Administration deposits”

A real lender earns its fee when they fund.
A fake lender earns money by pretending they might.

3. Real Lenders Provide Enforceable Term Sheets. Pretend Lenders Send PDFs.

A legitimate term sheet includes:

The legal name of the lending entity
The name and signature of the person with lending authority
Clear structure and conditions precedent
Identifiable timelines

Pretend lenders send pretty documents with no legal weight, no governing entity, and no accountability.

If a term sheet isn’t backed by an actual institution — it’s not a term sheet.

4. The Shadow Broker Problem: Brokers Pretending to Be Lenders

This has become one of the biggest issues in the industry.

Some brokers misrepresent themselves as lenders to get control of a file.
They talk like lenders.
They act like lenders.
They even borrow language from lenders.

But here’s the truth:

They have no capital, no decision-making authority, and no ability to close a loan.

What they actually do:

Take your file
Shop it around to random lenders
Add layers of confusion
Blame “their committee” or “their investor” when the deal dies

You end up with:

Delayed timelines
Diluted credibility
A damaged reputation with real capital sources

Ask this one simple question:

“Are you the lender, or are you brokering this to someone else?”

A real lender won’t hesitate.
A broker pretending to be one will.

5. Real Lenders Can Show Closings. Pretend Lenders Tell Stories.

There should be evidence of:

Closed deals
Funded loans
Track record
Borrowers who can verify them

Pretend lenders rely on:

Testimonials you can’t trace
“Confidential” success stories
Future projections
Theoretical commitments

Borrowers don’t need theories — they need closures.

6. Real Lenders Value Transparency. Pretend Lenders Value Confusion.

Confusion is a strategy.
It keeps borrowers off-balance and prevents them from asking the right questions.

Real lenders keep things simple.
They explain clearly:

Process
Timelines
Requirements
Costs
Expectations

Clarity is a sign of legitimacy.
Complexity is a sign of smoke and mirrors.

The Coterie Group’s Perspective

Since 1997, we’ve reviewed thousands of lender introductions, mandates, term sheets, and capital offers.
We’ve seen the good, the bad, and the unbelievable.

Our experience comes down to this:

A real lender doesn’t need to convince you.
A pretend lender needs to impress you.

At The Coterie Group, our job is to help borrowers avoid the noise and connect only with credible, verifiable, transparent capital sources — saving you time, money, and energy.

If you want us to review a lender introduction, a term sheet, or an intermediary claiming to be a “lender,” we’re always glad to provide an honest assessment.