Everything you should know about commercial real estate loans.

Commercial Real Estate Loans

 

Making a purchase or owning property is a great investment for you personally and is especially beneficial for your business.  One of the first steps to purchasing or owning your property is investing in commercial real estate loans.  Commercial real estate loans will typically loan you up to 65 percent of the value of your property.  Getting a real estate loan for property or a building will raise your business credit.

 

When getting a commercial real estate loans before the economic crash, lenders would give the buyer the opportunity to loan up to 80 percent of value in their property.  At the time, it was a great investment and a great way to build up the market.  As the commercial real estate business started to decline, owners and lenders found themselves facing major losses in their investments.  For example, your business had a building or another piece of property that valued at $100 million; this would give you, the business owner, an opportunity to finance your $100 million for $80 million.  This would then give your business $15 million making your commercial real estate loans an immense investment for you financially.  At the time these loans only had one stipulation, the commercial real estate loans had to be refinanced within five years.  Before the five year mark, the economy had already started to decline.  Once the decline started, business owners and lenders found the loans were more than the property was worth, leading many businesses into financial turmoil or bankruptcy.

 

The economy is slowly but steadily starting to mend; property values are starting to rise again and commercial real estate is rising.  Being a business owner, you may be ready to starting investing once again or you may be considering refinancing in real estate and getting a new or another commercial real estate loans.  Prepare yourself for what loans are on the market.  Whether you are the one looking into different mortgage or real estate companies or you have hired the service out, research every type of loan.  Most real estate loans will only finance a commercial real estate loan at 65 percent, while others may finance at a higher percentage rate if you have money to put on your property as a down payment.

 

Listed below are some investments ideas for you as the business owner to use.  These ideas will continue to help your business grow, your credit score to build and for your business to become a recognized and successful business.

 

  • Use a lender you trust.  If you use a lender you are unfamiliar with you place yourself and your business in the fate of the lender and what the market will do.  Neither you nor the lender can control what the economy and the market fluctuations.
  • When you getting your commercial real estate loans consider leaving your equity in your property.  Borrowing more against your equity could set your business up for a lose if the economy declines again or your business starts to lose capital.
  • When considering purchasing real estate, buy one property at a time.  If you plan on buying commercial real estate to flip, be sure the property is worth the commercial real estate loans you are drawing out and that you will be able to make your money, if not more on the sale of the investment.
  • Before applying for commercial real estate loans, have enough finances put away for a down payment.  The more money you have for a down payment, the smaller amount you will have to draw out on your commercial real estate loans, the smaller your monthly payment amounts will be.

 

Corporate Credit Concepts specializes in commercial real estate loans.

 

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