Commercial real estate can be complex, especially if you are new to it. To help ensure that you get the best loan possible for your purchase, here are a few things to remember.
Things can move slower than you think. Commercial lenders may tell you that processing can be done in six weeks, but it may take closer to three months. It is important to give yourself extra time for your loan.
Shop around for a lender. Commercial lending is not objective. Submitting your deal to multiple lenders can help ensure you get the best deal and terms that make everyone happy.
Lenders must order appraisals. Do not let a mortgage broker order the appraisal. The bank will not be allowed to accept it.
Toxic reports may be required. Examining the environmental contamination of a property will help determine who bears the cost of clean-up. Without a Level I toxic report, the lender bears any cost of clean-up.
Research commercial lenders. Con men can pretend to be commercial lenders and take the application fee without any follow-through. Research every potential lender extensively.
Local lenders are valuable. Quite often, you can get a better deal from a local lender compared to one who is from far away. They may also be more invested in the area because they are local, which can be beneficial.
Match the loan and lender. Small lenders do well with small loans, while bigger, more complex loans may be better handled by bigger banks. This can help ensure they can handle your application and get you the best terms based on your needs.
Whether you are new to commercial real estate or just want to ensure you get a good deal on your commercial loan, these tips will help. With the right commercial loan, you will be able to purchase a commercial property and achieve your career and financial goals.