Who Are the Potential Borrowers for Commercial Property Loans?

In the country’s current economic climate, business owners and real estate investors face harrowing challenges when it comes to securing financing to purchase or renovate commercial properties. However, the prospect is not impossible. Commercial property loans are available once the borrower has all of his or her ducks in a row.When seeking a commercial financial lender, the potential borrower should find a lender who is willing to share more than one loan option. The borrower can help expedite the process by taking the time to educate him or her on the basics of procuring a commercial loan well ahead of actually approaching a lender. Due diligence will make the process go much more smoothly.Traditional commercial property loans will have either variable or fixed interest rates.A lot of business owners find difficulty in coming up with a sufficient down payment required for a conventional loan. In addition to this, they must also present money for the additional soft costs, which include closing costs, filing fees, processing fees and other expenditures.When seeking a lender for commercial property loans, the borrower should seek out the lender who operates from an innovative lending platform, that is, someone who is willing to go over and aboveboard to help the borrower procure the funds. There should be multiple loan programs from which the lender can choose and the lending organization or individual should hail from an experienced, seasoned background and be well versed in the ins and outs of commercial property loans. The sign of a good commercial lender is the ability to give fast, accurate quotes and to give approvals upon which the borrower can count.The borrower should seek a lender that offers flexible, fast financing. A streamline, simplified loan process is an added plus, especially when the lender requires more relaxed underwriting guidelines. This can save the borrower a lot of time and headaches. It can also save money.Ideally, the borrower should find a lender who will make commercial property loans to at least 90 percent of the loan-to-value rate. The lender should also offer 30-year terms on commercial loans. This should apply to both traditional as well as non-traditional properties. A good lender will be able to wrap up the entire loan arrangement and close within 30 to 45 days. They should also offer unlimited cash-out refinancing.If the borrower is looking for a low, permanent fixed rate loan for commercial real estate to acquire refinanced or stabilized commercial properties that include hotels, industrial locations, mobile home parks, multifamily dwellings and the like, a conduit loan may be the answer. This type of commercial property loan offers potential borrowers the lowest fixed rate financing for commercial enterprises, beginning at 70 BPS over the conventional Treasury rates. They also offer high leverage rates for investors by offering a standard 80 percent loan-to-value ratio and an option to increase leverage as high as 90 percent.No personal guarantees are required for these non-recourse commercial property loans, other than the standard borrower fraud or other behaviors that are illegal.