The words commercial mortgage financing have been bandied about recently as being the solution to many small business owners who are facing tough times in an economy that does not show signs of growth. It can be hard though for any business owner to get to grip on the different type of commercial mortgage loan as well as the requirements that have to be filled to obtain one. The biggest factor that affects commercial mortgage financing is the value of the property. This will form the basis of the loan and will be the security that keeps the loan in place. Whether it is an application for bridging finance, or a way of consolidating other loans into a convenient package, the process of commercial mortgage finance is one that can be a lifeline for any business and can be used to promote future growth.
Ways to Ensure a Successful Application for Commercial Mortgage Financing
? Evaluate the property. This is the first step in applying for commercial mortgage financing and the best way to establish the value of the property in the eyes of a lending institution is to perform a debt service conversion ratio exercise. Most lenders will do their own investigation, but it might be wise to get an independent assessor to ensure that the figures are available before approaching the banks for a loan.
? Look at the location of the property as well as the condition of the improvements on the land. Improvements are the buildings and the services that are on the property. All banks have a list of areas that they consider to be ?high-value? and they base their loans on whether or not the area shows growth or expansion potential. Even the nicest building on a property that is located in a red-line area will not be able to secure the type of loan hat is needed. Before investing in any alterations, ensure that the location is suitable for a loan.
? The value of the buildings and services that are in the property will also have a large impact on the amount of the loan. An assessor will be appointed to ensure that the interests of the lending institution are protected at all times.
? Income producing property, such as apartment buildings will be able to secure a loan based on the future income potential of the property. These figures will form a part of the loan application and should be presented to the lender as soon as possible.
Taking out a commercial mortgage financing loan is a way of consolidating a business so that it has the potential for future growth and profit. There are many way of utilizing the services of an excellent commercial mortgage finance company to help keep a business in business. Which of course if where you want to be.
To know more information about Commercial Mortgage Financing and Commercial Refinance visit ICPFinancial.com
Source: http://refinance.maxmoneymarketing.com/debt/commercial-mortgage-financing-getting-a-grip-on-the-process/
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Source: http://akygynogimi.posterous.com/commercial-mortgage-financing-getting-a-grip
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