Showing posts with label comercial lending. Show all posts
Showing posts with label comercial lending. Show all posts

Friday, February 3, 2017

Commercial Mortgage Basics

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Interested in a commercial mortgage? If, so it never hurts to make sure you know the basics.

You might be surprised how many people consider a commercial mortgage or non-residential mortgage without truly know the basics. Sure, the right lenders and loan officer will gladly guide the way. But, nevertheless, it is still important to first-hand what you are potentially signing up for, right? Of course, it is that’s just common sense and good business. So, let’s get down to some of the basics.

For starters, just like anything else these days, there seems to be an overwhelming amount of information available for all things commercial mortgage. In fact, any standard internet search will more than likely yield you dozens of articles. But, assuming you are like most business savvy individuals you probably do not have the time to sit down and go through countless articles and that‘s perfectly okay. In all actuality, you can narrow non-residential mortgage basics down to around four major points—the purpose or use for a non-residential mortgage, where to obtain this particular mortgage, how to qualify and of course what are the terms.

Typically, the purpose or rather what you can use a non-residential mortgage for is large commercial properties like warehouses, office buildings or financing for company property improvements. You can also choose to use this particular kind of mortgage to refinance existing commercial loans. With that being said, when in the market for a non-residential mortgage your best lender options are generally banks, especially if you want to deal with the people who are originating your mortgage. Once you’ve decided on the right bank lender for you, the next thing that absolutely has to happen is finding the time to sit down with your commercial lender to go over the terms and qualification requirement in full, clear detail.

Commercial Mortgage - Where to Begin

Clearly, you should never get any mortgage without its terms and borrower requirements being fully explained. Nevertheless, it goes without saying that really no two non-residential loans will be alike. Thus, it makes sense to do the necessary research and ask the necessary questions that pertain to your business, your commercial project, and the actual property. In general, most mortgages that are used for commercial purposes have a repayment period of five to ten years with property improvement mortgages or loan needed to be repaid sooner rather than later. Lastly, no mortgage or loan comes without fees, thus, you should also make sure you are clear the closing costs and more.

Things to consider when figuring out if you Qualify for a Comercial Mortgage

Also a side note, when figuring out if you actually qualify for your business mortgage or non-residential mortgage remember lenders determine your creditworthiness based upon your business credit score, which often varies from company to company. Due to this fact, it is almost a necessity to have your business credit in order across the board because most banks see low or unfavorable business credit scores as a strong indication of your inability to make on-time payments and you never want to give off that impression when applying for a mortgage.

 

Happy senior business man making his notes at workDennis Dahlberg Broker/RI/CEO/MLO
Level 4 Funding LLC 
Private Hard Money Lender

Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com
NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701

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About the Author:  Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.


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Thursday, February 2, 2017

Common Mistakes Brokers Make In Loan Applications Sent To Commercial Hard Money Lenders

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Trying to get financing through a commercial hard money lender is not the same as from your traditional hard money lender. Many traditional brokers do not realize this and end up making some common mistakes.

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In a perfect world, we would all have good credit and would have no problem getting approved for a commercial loan of any kind—but our world is far from perfect, much like our credit ratings. But to get approved for a traditional commercial loan you typically need to have a pretty good credit rating.

The importance of goo credit in getting a loan approved does not mean every business person out there has great credit. Chances are many of them do not. So how did they get a loan approved? They—or their broker--worked with commercial hard money lenders.

These types of lenders understand that they are taking on clients that are at a higher risk of defaulting. So they have the terms of the loan reflect the risk they are taking. While they may not be fond of them, if a borrower had a better option they would take it.

However, the process of getting approved for one is a little different than a traditional loan. If you are not careful, you may find your commercial hard money lender rejecting your application.

Things To Consider When Applying For A Loan From A Commercial Hard Money Lender

Filling out a loan application can be a confusing and difficult task no matter what it is for, but when you apply for one from a commercial hard money lender there are certain things you need to do that you probably did not in your application to the bank and credit union:

Tell your loan’s story. Don’t just tell your lender that you need the money. Since the risk is higher for them, they often want to know more. Tell them why you want the money, what you are going to use it for, and what you are hoping to accomplish with it. Give the lender the story behind the deal.

Don’t just submit a ton of information and data. Submit the right data. It is not uncommon for a broker to turn in an application that has way too much information and data in it, but not have the right stuff. For example, an application includes the borrower’s tax returns but fails to include the exact amount being requested.

Loan packages can be pretty big making it easy for something important to get overlooked. Including a summary of the major points and data with your application along with an executive summary can take care of this issue. This can also be a great way to get on your loan processor’s good side.

Everyone appreciates it when they don’t have to work as hard to get their task accomplished. Organizing your application can be a great way to earn brownie points with the loan processor.

Who doesn’t like brownie points?

 

Happy senior business man making his notes at workDennis Dahlberg Broker/RI/CEO/MLO
Level 4 Funding LLC 
Private Hard Money Lender

Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com
NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701

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About the Author:  Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.


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Monday, January 30, 2017

Commercial Lending Requirements

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Commercial lending despite its many incentives is no walk in the park. In other words, there are things you need to understand as well as have on-hand in order to move forward with the commercial lending process and future business endeavor.)

As you know, commercial lending wants start-ups and well-established businesses to succeed. However, just like any other kind of lending or financing, there are requirements and regulations. Therefore, if you trying your hand at securing commercial financing, it may be helpful to know what those standard requirements and regulations are.

For instance, as a savvy business owner, you clearly understand what collateral is and how can be used to secure any kind of financing. But, when it comes to commercial loans, collateral is only a requirement if you are a newer business or rather start-up. The reasoning behind collateral in this instance is the simple fact that start-ups do not possess a long credit history. Moreover, speaking of credit, it is important to note that even a well-established business may need to rely on or resort to the use of collateral because they simply do not meet the standard requirement for above average business and/or personal credit.

Furthermore, collateral in the commercial world of lending does not always mean your house or car. In fact, most businesses that resort to using collateral to secure commercial financing use their business assets such as their accounts receivables. What is more that often a company’s accounts receivables are not enough, thus if you go this route you will likely have to pledge your accounts receivable, a percentage of your inventory and possibly even your personal assets like your home or vehicle. Consequently, when the term collateral comes up in reference to commercial financing it is important to know what that really entails.

 

Commercial Lending Regulations

Of course, there is much more to commercial financing besides above average credit and the possible need for collateral. For example, you will not get too far with your dreams of commercial financing if you do not have a solid business plan. Sure, there are some exceptions to this rule, but you are really only hurting yourself in the long run if you do not take the time to devise a clear plan for your financing. Moreover, you will be hard pressed to find a lending institution that did not want to know what your projected plans were with “their money”. Therefore, it is safe to say that a business plan is more than a requirement. Similarly, if you are using collateral and disclosing your credit history, you need to have complete documentation. This means details on all things financial, accounts receivable, accounts payables, tax returns, and insurance documentation—just to name a few.

 

Commercial Lending - Your Eligibility

Ultimately, these are just a few of the long list of requirements and regulations that you will come across during the lending process, but, nevertheless, these are the major requirements of most commercial financial institutions. Thus, you should have these above-mentioned things together before you take your potential business venture any further.

Level-4-Funding-Dennis-Dahlberg-Mort[1]Dennis Dahlberg Broker/RI/CEO/MLO
Level 4 Funding LLC 
Private Hard Money Lender

Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com
NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701

 You TubeFace Book Active Rain Linked In 

About the Author:  Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

 


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