Private Money sources provide some of the fastest, most flexible options for Commercial Real Estate Lending.
There are 3 main necessities for successfully acquiring
properties:
Here’s a 5-point check list to straighten out before a successful
commercial property loan approval.
1. Are Tenant leases going to expire soon and if so, do the leases have automatic renewal clauses. This scenario may lower the loan-to-value ratio, insist on lease extensions prior to closing — or decline the loan request.
2. Does the Tenant mix include too many high risk businesses such as hair salons and restaurants?
3. Timely Rent payments? The seller’s record of tenants’ payments will be scrutinized for consistency, timely & full payments. Without consistent tenant payments, the buyer may need to consider alternative financing such as the Bridge Loan.
4. Does the buyer’s Relative Experience match the intended property? Does the buyer have the background to manage the various issues that will likely follow? Will the buyer be able to handle the full scope of the work? If not, is it possible to bring in a partner that can better meet this criterion?
5. Sufficient Liquidity.
Working Capital is the life blood of any business, including Commercial Real-estate
investing. So it’s critical the
applicant be able to document Liquidity that is available prior to your loan
application. Whether the source is your
own money, lines of credit, partners or investment groups, be ready to document
that information prior to applying, have a clear picture where your liquidity
will come from.
Click here basic long-term Commercial Real-Estate loan guidelines.
... to make your investment possible. You can obtain your property using a Commercial Bridge Loan for the first 1 – 3 years but you will need a workable exit strategy. It's possible to extend your Bridge Loan after your 3 years run out.
The Commercial Bridge Loan option might be ideal if your urgency is simply to
obtain the property, make improvements and then lease your property to full or
near full capacity, and then set yourself up for low long-term funding.
You might consider a Commercial Bridge Loan if your credit score is low, the Commercial Bridge Loan would
give you breathing room to consolidate balances, make efforts to correct your
credit score, make repairs and then sell.
These loans require fewer documents than long-term Commercial Real Estate Lending and less restrictive to approve so long as you, the borrower, have a workable end game as this 1-3 year loan comes to an end.
Funding ranges from $500,000 to $100million.
Click here for basic Commercial Bridge Loan guidelines
New Commercial Construction financing is available for ~
Your projects should range from $20million to $300,000 million and be in or around Major Metro Areas, no rurals.
And please click on this link for New Commercial Construction financing criteria.
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