Commercial real estate loans are ideal for businesses looking to either purchase, develop or construct new property as well as current commercial property. The way it works is businesses can apply for this type of financing in order to secure a loan (may also be referred to as mortgage for this specific financing) which itself is secured by liens on the commercial property. As the name states, this is for commercial properties only and not for residential properties. Understanding that this loan is for commercial real estate, the terms and rates may differ from a traditional residential mortgage.
The use for this type of financing can vary, meaning the business does not have to acquire new property in order to apply. This loan can cover expenses such as refinancing or renovations needed on current business real estate in addition to covering new real estate property. Small business owners or even large corporations may be eligible for this type of loan. Keep in mind, this type of financing is very different to a traditional residential mortgage that you would apply for when purchasing or refinancing a residential property. Aside from different terms and rates (as mentioned above) the requirements and application process vary as well.
Loan amounts starting at $75,000 and range up to $2 million.
Loan terms starting as low as 5 years ranging up to 20 years.
Monthly payments from an account on file.
All you need is 3 important documents to apply.
Commercial real estate loans work by granting approved businesses with the working capital needed to either purchase a new commercial property, refinance, or work on renovations for current commercial real estate. The loan itself is a mortgage that is secured by liens on the commercial property. Lenders will take into consideration the loan-to-value ratios which means the process for getting approved for this type of loan can vary greatly from a traditional residential mortgage.
A commercial real estate loan makes sense for your company if you have the intention of using the working capital for commercial real estate. This type of loan will not work for primary or secondary residential residence. In addition, a few things to keep in mind is that the interest and repayment terms vary greatly from a residential mortgage.
Requirements for a commercial real estate loan vary depending on the lender and type of loan your business is looking to apply for. As a general rule, lenders will take into consideration your business financial statements, your company’s debt service coverage ratio, property characteristics such as property use and value, percentage of expected/current occupancy, among other requirements.
Any company whether a small business, mid-sized company, distributors, or large corporations that has the intention of either purchasing new commercial property, renovate current commercial property, or refinance a current commercial mortgage. Remember, this is for property for commercial use only.
The commercial real estate loan rates truly depend on the lender the business is looking to work with in addition to the type of loan that you are looking to apply for in order to secure a mortgage for the commercial real estate, or refinance. As mentioned, the rates are very different from a traditional residential mortgage loan so please take this into consideration before applying.
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