Commercial Property Loans by Dymphna Boholt

Dymphna here with some information regarding commercial property loans. Real Estate investing is going to be a lucrative business over the next few years. Those of you who are smart will begin looking for investment properties to invest in.

Commercial loans are available to businesses and corporations, regardless of the structure. If you own a business, you can seek out a commercial loan. These loans are not only available from banks, but also from private lenders, offering a different funding source with fewer restrictions.

Even though commercial loans are available to your business, they are not easy to get. These loans are generally for larger sums, with shorter payoff times. Because of these standards, the loan application process can be grueling and complicated.

You need to start the lending process by having the property you are interested in appraised. Find a good appraiser who will give a fair appraisal value. If the property appraises for less than the loan amount, you will have a hard time getting the larger amount. That means you will have to negotiate the price down, or make up the difference by putting more money down.

Check your credit before going to the lending institution. Having this information ahead of time will help you fix any errors, thus improving your credit score. Take this opportunity to pay off or at least reduce the amount of outstanding debt you have. Too much outstanding debt could make the lender think your business is overextended, causing them to deny you credit to buy your property.

Choose the right type of commercial loan to go with your needs. There are several different types of commercial loans. If you are only expecting to be in the property for a short period of time, you could get an interest only loan. This type of loan allows you to make payments on the interest only for a few years, usually five, then you have to pay the balance. This is a short term loan and you need to have a definitive exit strategy before signing the contract.

A good long term commercial loan would be a fixed rate loan for 15-20 years. This will help you lock in a steady interest rate, and actually pay off the loan in full by the end of the contract – no balloons. This is a great way to go if you plan on being at your new property for a long period of time.

Here at Dympna Boholt, I am Hopeful, this information will help you in your search for expanding your business. There are some great deals out there right now. Take advantage of it.