How to Prepare for Commercial Mortgages

There are many steps that you need to take before you begin your search for commercial mortgages. Following a well thought out plan can make your process less stressful and much more successful.

As you prepare to purchase a commercial property there are many steps that you should follow before you submit your loan application. Securing commercial mortgages can take a long time and errors during the process will only make it take longer. But having a strategic plan to follow will help you to avoid any issues that will add more time to the already lengthy process. Your first goal should be learning about the process associated with commercial mortgages including the application process and requirements, the approval process and the terms that you will have outlined in your loan agreement. The more knowledge you have the less difficult and stressful the process will become.

Part of your research will entail learning about the potential lenders that you could be doing business with. Because commercial mortgages are so large and sometimes difficult to secure, many borrowers look at the lender as some larger than life entity. This perspective can make then seem very intimidating. But you need to view the lender as a strategic partner or supplier and nothing more. They are providing you with a service, a loan, and you are simply doing business with them. In a way they should be catering to you as you are their potential client. Fear or intimidation is never useful. Simple professionalism and respect are all that is required to begin to build a successful, professional relationship with a lender.

Going one step further, as you speak to prospective lenders, be honest with them about the financial health of your business and also about your personal finances. Giving them accurate information will allow them to provide you with the most helpful and useful information as you begin to evaluate who might be your best choice as a lending partner.

Invest Your Time in the Process

Understand that as you are getting to know the lenders, they are also getting to know you. In many cases, especially with a first commercial loan request, lenders need to gather a great deal of information. Your business might not have a long financial history so the lender will be basing a large part of the decision on you as the owner. That means that the lender will want to learn more about you than what the numbers on your financial statements can tell them. Don’t be afraid to tell your story and explain why you started your business, how you have managed to grow it to a point where you are looking to purchase a commercial property and what your goals are for the future.

More than Just an Application

It is important for you to remember that there is much more to securing a commercial loan than just successfully completing the loan application. This is a very important step for your business and one that you should prepare for carefully. Having a good understanding of the process and what you need to demonstrate to qualify for a loan will ensure that you are successful in finding the right lender and the best loan to meet your needs.

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

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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