There are many lenders who specialize in home financing. However, many of these lenders also offer commercial property financing. When in need of commercial real estate financing, therefore, you should look for the best lenders in the industry. Ideally, you should give strong consideration to firms that have specialized in commercial real estate financing as they are more likely to understand your needs and expectations. By shortlisting the most suitable lenders for your needs, you will be able to narrow down your search based on a variety of factors.
With your shortlist in hand, there are several key factors you have to consider as you try to narrow down your search. They include:
i) Interest Rates
When planning to buy a commercial property, you hope to generate regular income from the property and make huge profits. You can earn bigger profits if the monthly mortgage payments are much lower than the monthly rental income from the property. By looking for a loan with the lowest interest rate, you can be assured of earning huge profits time and again. Therefore, you have to compare the interest rates quoted by different lenders before deciding to commit yourself. You can decide to work with a reputable broker to help you with the search for the right lender.
ii) Down Payment
Aside from the mortgage rate charged by a given firm, one of the most important factors to take into consideration when comparing lenders is the mortgage rate charged. The top lenders usually offer almost 100% financing, but most of them also require expensive mortgage insurance. To get the best value for money, only lenders with a low down payment requirement and almost negligible mortgage insurance premiums should get preferential treatment.
iii) Terms and Conditions
Some lenders usually have strict terms and conditions. For instance, they may offer a shorter repayment period for commercial loans. They may even offer lower loan limits and demand the credit report of the principal borrower. Before putting pen to paper, therefore, you have to look through the terms and conditions page of the shortlisted lenders. This will enable you to pick the best lender for your needs.
It is important to note that not all commercial properties are great investments. Therefore, you have to compare the available properties to identify the best one for your needs. It is going to take time to conduct the necessary research, so you needn’t be in a rush to make a commitment.
