At one point in time, banks, relatives, and loan sharks were the only options when you needed a loan. Nowadays, that is not the case. There are several options available to people looking for commercial real estate loans.
Opening your own business can be a dream come true. No longer will you depend on the success of a company to keep the paychecks coming in. The success of the company is going to rely on you. No more blaming the boss—because the boss is you!
If you think you have a can’t miss idea in mind and have the desire and determination to see it through, the first thing you will need to do once you develop a business plan is to seek out a commercial real estate loan. So—where do you start?
Most commercial real estate loans are made by commercial banks, but they can be had elsewhere:
Credit Unions: A credit union is a considered a financial cooperative that is owned by its members and controlled by an elected board. The purpose behind them is to provide members with competitive credit rates and other financial services—including commercial real estate loans.
There are currently more than 6200 credit unions with over 21,000 branches serving 100 million members in the United States.
Commercial Hard Money Lender: If business is bad or if you have poor credit, you can still get a commercial real estate loan from a private individual, mortgage company, federal bank, or an SBA lender. Terms can vary, and borrowers will need to secure the loan with collateral or an asset of value. Interest rates tend to be higher to compensate lenders for taking on the greater risk.
Life Insurance Companies: for smaller loans, businesses will typically go to a commercial bank, but for a larger, long-term (+10 years) commercial real estate loans, life insurance companies have become popular options. Companies using them will have to use something like an office building or shopping mall to secure the loan. They tend to be conservative when it comes to approving loans.
Commercial Mortgage Backed Security Lenders (Conduit Lenders): these facilities lend money secured by some form of collateral, typically a mortgage on a piece of commercial property. They will usually have fixed interest rates and for a term of 10-years, but are considered more complex and volatile.
If you are ready to take the plunge to find a lender who gives commercial real estate loans, look no further than Level 4 Funding. Our dedicated team of commercial specialists know commercial real estate. We work in multiple states and multiple industries. With our connection, we are almost guaranteed to be able to help you find a loan product that meets your needs.
Call our office today to talk to one of our professionals about commercial real estate loans and you. You will be glad you called!
Dennis Dahlberg Broker/RI/CEO/MLO
111 Congress Ave |Austin | Texas | 78701