Tag Archives: commercial hard money

When is the right time to cut your losses in the real estate business?

The real estate industry can be extremely tumultuous under normal conditions. If you are doing it correctly, you will run into a few extra problems that come with investing. What separates the inexperienced investor from the pro is knowing when to throw in the towel. Now, we are not saying that as soon as you find a water leak in your property you should give up, but you need to be aware of your investment as all times.

For many investors, this means having a solid exit strategy before you are able to commit to a new project. A solid exit strategy allows you to drop one project and go after another within a few days. For some investors, this could be after a certain number of repairs exceed their comfort level. Along the lines of property renovation, an investor could have a financial cap set in place before they decide to pull out on their investment.

Research makes perfect in real estate

An experienced real estate investor takes their time to thoroughly vet a property and the geographic area before making an offer. They will most likely go through an extensive checklist before making a decision. Sometimes hard money lenders in Texas are able to help you with your research, however, most of the legwork is up to you.

Enough research can tell you the right amount of money you should put into the property. Often many investors bite off more than expected with a property. In the event that the repairs begin to outweigh the possible revenue that you are expecting you should begin implementing your exit strategy.

When is time to step away from your investment?

The moment you feel as though you are not going to make any profit on the property is the time you step away. Some investors will tell you to stick it out a little longer, while most will tell you to stick with it. In the long run, you must do what is right for you. Maybe you have expended all the money you set aside for the project.

Most of the time at this point other investors will not want to or be able to help you in your investment. One of the most important details that you want to remember about real estate is timing. Your timing is everything.

Say you ask your hard money lender in Texas for an additional loan from more construction, however, recently there has been a decline in the demand for homes. Now, you have a home that may not sell for the next two or three months. With a hard money lender, usually you will have a fairly short term loans this will not work.

With an exit strategy, you give yourself more options

Allowing yourself to leave your investment if you need to, till ultimately save you thousands of dollars in the end. It may seem like a loss at first, but a loss will hurt much worse if you are left with debt.

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
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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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

How You Can Solve Your Commercial Loan Woes with the Help of Hard Money Lenders

If you can get a loan, you can catapult your business into the next echelon, so why not shoot for the stars? When you are having trouble getting your commercial loan approved, it might be time to seek the assistance of hard money lenders to get you the cash you need.

Whether you are a first time investor looking at purchasing a property or a new business owner that needs cash fast to get your business off the ground, commercial loans can be a godsend. However, sometimes as a first time borrower, traditional lenders might be a little skeptical of loaning funds. That’s when hard money lenders come in handy. Just when you think you might not be able to get a loan at all, you’ll see that they can help you make your business and investment dreams come true.

Just as with any loan situation, there will be challenges that arise along the road. You will need to be prepared to handle any situation by working closely with your hard money lenders to find a win-win solution. Sometimes it’s a matter of finding the right lender for the type of investment or business you have. Sometimes it’s a document or statement you’ll need to provide. Be flexible and patient, while the process can at times be frustrating, it’s important to have a lender you can trust to guide you through it all.

For investors and new business owners looking to purchase property, there are many types that these lenders specialize in like foreclosure properties, “fix and flips”, short sales, construction loans and land loans. These loans are also beneficial for business relocation that needs to happen fast as well as for borrowers that do not have the best credit score or history.

These lenders are very different than conventional bank lenders.

It’s important to know that dealing with conventional lenders are a totally different story – their application process is very detailed and often quite lengthy. There is a lot of bureaucracy and “red tape” that can be avoided with hard money lenders. If you’ve applied for this type of loan in the past, you know the road can be long and arduous. Luckily, that’s not the case with non-traditional lenders and alternative lenders offer many benefits – including an easier application process and quicker turn around time.

It starts with the right lender.

The lender is just as important as the loan itself. It becomes something of a partnership, so finding a lender you can rely on is very important. You will want to ensure they can guide you through the process but also won’t take advantage of you either. Ask around to see if business associates or friends can refer a great lender they’ve worked with in the past. Look for a local lender and don’t be shy about meeting with them and asking questions prior to agreeing to move forward. Once you find the right lender, the road to getting your loan will be much smoother!

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
clip_image002clip_image004clip_image006clip_image008

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

How to Avoid Phony Hard Money Lenders

Some phony hard money lenders have ruined it for a lot of lenders in the industry, as now many are looked at as money sharks. It is important to steer clear of the fake lenders and only deal with the real ones that you can trust.

There are many respectable hard money lenders out there and you can easily spot the fakes one if you pay attention to the red flags. Nothing can be a bigger sign than poor grammar and misspellings in the actual documents. This is one of the biggest signs that you are probably not dealing with a lender in the United States. It is always a smart move to work with a local lender. Also, be cautious of the number of types of loans they offer. You want to find a lender that specializes in hard money. It is usually a scam when a lender offers multiple types of loans like business loans, personal loans, home loans and car loans all in one place.

When it comes to a hard money loan, it usually requires some form of collateral to secure the loan. If you get an unsecured loan, that could be a sign of trouble. You never want to deal with those and also be wary of having to pay any large upfront payments. A large amount required at the beginning of the process is always a bad sign. Usually, only a small amount should be required as upfront payment.

A very low interest rate, ranging between 2 percent to 4 percent, along with no requirement of monthly payments, is also a sign that you should probably not deal with those hard money lenders. There is such a thing as too good to be true and these types of terms is usually what that means. Also, avoid lenders who do not have any websites or establish company emails. Scammers are known to use generic emails like Yahoo, Gmail or Hotmail. There should be no reason that you need to search hard for any proof of their reputation.

All reputable lenders will have a website that contains basic information about them.

It is always a good idea to do your research and homework on any company that you decide to work with when it comes to dealing with finances. The website should always include information about where their physical location is, contact information, information about recent loans they have closed on and reviews. Scammers will often not have a website at all, or try to include as little information as possible. If you are still unsure, you can always check on their licensing. It is not a requirement to be licenses with the Better Business Bureau, but it is always a good sign when they are.

Pay attention to all of the documents and offerings.

Reputable hard money lenders will always be upfront about the programs they offer. They usually provide a sheet listing their terms along with a commitment letter. If you are being pressured on the spot to make a decision right away, then you should probably look for another lender. You will usually be given enough time to do your own research to make the right decision.

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
clip_image002clip_image004clip_image006clip_image008

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

The Difference between Bank Commercial Loans and Private Hard Money Lenders

3page_img1Hurricane Harvey is gearing up to be the second most costliest natural catastrophe to hit the United States. Investors and developers are already reaching out to commercial lending institutions in search of funding.

In addition to the immense devastation and human tragedy caused by Hurricane Harvey, its economic impact is expected to rank as the second most expensive natural disaster to occur in America. According to an article in the New York Times, Moody’s Analytics have estimated the damage to be in the $40 to $50 million ballpark. This is second only to Hurricane Katrina which killed almost 2,000 people and caused $130 billion in damage. Note: A recent article in USA Today raised the estimated cost of Hurricane Harvey to $190 billion. Commercial properties that have been flooded are estimated to cover approximately 455,000 square feet. Just as in 2005, rebuilding will accelerate once insurance checks are cut and federal aid is disbursed. And investors are already lining up to raise funds from commercial lending institutions for distressed properties.

Before Harvey hit, the building and construction segments were, as in other parts of Texas, booming in Houston. According to an article in Dallas News, “At midyear, more than 27,000 single-family homes were being built in the Houston area. And more than 23,000 apartments were under construction and scheduled to open this year.” Due to the increase in demand, construction firms and those they employed were already maxed out when Harvey hit. Now, in the wake of the devastation, other investors and contractors will be arriving to fill in the gaps. Just a few of the investment companies looking for commercial lending include Delshah Capital, Madison Realty Capital and Steven Witkoff, a New York developer.

The San Diego Union reported that more than 3,000 national and state guard troops were being deployed to assist with relief and recovery efforts. Water, food and shelter are the top priorities at this time. As the waters recede, there will undoubtedly be an influx of contractors, insurance adjusters and FEMA employees. Currently, there are more than 200 shelters housing more than 32,000 people who have been displaced due to the catastrophic nature of Harvey. Because of these two factors, multifamily units are expected to be in high demand.

Timing

At Level 4 Funding, our hearts and prayers go out to those affected by this national disaster. With an office in Dallas and clients in Houston, we are very close to those affected. We hope that investors and developers will show good taste and wait for the waters to recede and displaced residents to find housing before making their move. At the right time, these individuals and businesses will be a great asset to the recovery of this place in America that has shown its true colors of faith, humanity and neighbor helping neighbor in the midst of incredible challenges.

“Bad things do happen in the world, like war, natural disasters, disease. But out of those situations always arise stories of ordinary people doing extraordinary things.”—Daryn Kagan.

When the time is right, we are here to help those looking for immediate funds and commercial lending with which to rebuild this incredible area of our country.

mark-gowlovech-150x150Dennis 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

Dennis Dahlberg Broker/RI/CEO

NMLS 1057378 | AZMB 0923961 | MLO 1057378

22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027

111 Congress Ave |Austin | Texas | 78701   

     Linked In Active Rain     You TubeFace Book         

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.

Technorati Tags: commercial mortgages,commercial loans,commercial lender,commercial hard money lenders texas,commercial mortgage Texas,commercial loan Texas,commercial mortgage Arizona,commercial loan Arizona

Advantages of Commercial Bridge Loans for Real Estate Investors

Real estate investors commonly use commercial bridge loans when purchasing properties. Find out the best use for these types of loans.

Bridge loans are, as the name suggests, a bridge from one asset to another. Real estate investors often use these short-term, asset-based loans due to their rapid funding and easy qualifications. The term for this type of loan usually ranges from 3 to 12 months, though they may often be extended. Here are just a few of the many reasons commercial real estate investors are looking to this type of funding.

1. Provides funding for an additional investment property while you wait for another property to sell.

2. Quick capital for those properties that are being auctioned off and are acquired on a cash-only basis, or properties with multiple offers that will not accept a contingency based bid. A foreclosed property may come on the market and require quick action.

3. An investor is waiting for traditional funding and must cover expenses during this month-plus process.

4. If acquiring a property for a fix and flip, a bridge loan gives an investor access to quick capital that can be used for purchase and renovation. This same loan provides for interest-only payments during the renovation process and a principal payment after the property has sold.

5. When an investor needs additional funds to finish a project and get it on the market.

6. Some use these types of loans to buy out an investment partner. In this instance, funding may have initially been acquired using a participating mortgage loan. The lender, in these instances, becomes like a partner. And, as well all know, partnerships don’t always last.

The beauty of commercial bridge loans lies in their use of collateral to secure the loan. If an investor is confident in a commercial property but it currently does not have the needed loan-to-value ratio, they can fund a project through their own home’s assets and pay back the loan as soon as the investment property sells. Another benefit of an asset-based loan is that many hard money lenders will not take into account the creditworthiness of the applicant. They are more interested in the property and an exit plan.

Obtaining a Commercial Bridge Loan with a Hard Money Lender

Most bridge loans are obtained from alternative lenders. Private hard money lenders are one of the most common sources. They are specialists in asset-based loans making commercial bridge loans an ideal offering for their type of funding.

At Level 4 Funding, we specialize in short-term 3 to 12 month bridge loans with interest only payments starting at 7.99 percent. These may be extended up to 24 months and we fund up to 90 percent LTV.

We are interested in the project and you as a person more than we are interested in your credit history. We work with hundreds of private hard money investors, many of whom are interested in particular projects which include bridge loans for real estate investors. Call us for a no-obligation quote.

mark-gowlovech-150x150Dennis 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

Dennis Dahlberg Broker/RI/CEO
NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701   

     Linked In Active Rain     You TubeFace Book         

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.

Technorati Tags: commercial mortgages,commercial loans,commercial lender,commercial hard money lenders texas,commercial mortgage Texas,commercial loan Texas,commercial mortgage Arizona,commercial loan Arizona

The Benefits of an SBA Commercial Mortgage

The Small Business Administration offers small and mid-sized businesses a commercial mortgage loan for owner-user and owner occupied commercial real estate. And the best part of the loan could be the amazingly low down payment that is required.

As a small business owner you might already be familiar with the Small Business Administration and some of the programs that they offer. And if you are looking into purchasing commercial property then you will want to explore the option of using the SBA 504 program. If you qualify, you could get two loans that would allow you to purchase and renovate an owner occupied multi-use property with fixed financing and you would never have to worry about a balloon payment or a rate change for 25 years.

The first mortgage 504 loan is a 25 year loan with a down payment as low as 10%. This can be used to purchase your property, refinance or renovate. You can even use this loan to refinance a previous 504 loan that is at a higher interest rate. And the properties that are eligible include offices, warehouses, retail buildings, light industrial buildings, manufacturing facilities, medical buildings and research and development facilities.

To qualify for this program you will need to have a credit score of 680 or better and no business or personal bankruptcies in your history. In addition, multi-tenant properties are acceptable as long as the owner occupies at least 51% of the property for existing structures or 60% of any new construction facility. When submitting the business financial statements for consideration, the majority of the tenant rental income can be considered on the business income statements. And finally, if you are financing a property that is valued in excess of 20 million dollars, you will be required to make a down payment of 15% to 20% depending on the value of the property.

Another Option Is the 7a Loan Commercial Mortage

The 7a loan offers 100% financing for certain types of established businesses and the loan can be used for purchasing property, refinancing or for construction. You will need to demonstrate good credit and a consistent cash flow to qualify for this type of loan as well. This type of loan is one of the few that caters to businesses which do not have a large equity down payment such as a medical or dental practice, attorneys, architects, independent pharmacies and funeral homes.

Take Advantage of the Benefits of a Small Business Commercial Mortgage

Having the opportunity to purchase a commercial property with as little as 10% down is a great benefit. It allows you to have more operating capital for your business during your growth and expansion. In addition, having the ability to lock in an interest rate for up to 25 years without the worry of rate increases and balloon payments will make your financial planning and repayment process much easier. And finally, if your business is in a sector with strong cash flow and consistent income then you don’t need to worry about having few assets or little equity, there is a loan that can meet your needs. The SBA offers many businesses a win-win solution and they are always there when you need them.

mark-gowlovech-150x150Dennis 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

Dennis Dahlberg Broker/RI/CEO
NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701   

     Linked In Active Rain     You TubeFace Book         

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.

Technorati Tags: commercial mortgages,commercial loans,commercial lender,commercial hard money lenders texas,commercial mortgage Texas,commercial loan Texas,commercial mortgage Arizona,commercial loan Arizona

How to Find a Commercial Mortgage

Thinking of buying a commercial property? Then learning about securing a commercial mortgage is critical to your success.

A commercial mortgage is a loan that is being used to buy a commercial property that your business is going to occupy. Most of the time this requires that your business occupy the majority of the space, meaning 51% or more. Then the rest of the space can be leased to other tenants. The types of buildings and uses can vary widely to include retail space, office building and also mixed use properties. If you are interested in owning commercial property then you will want to have a better understanding of the five types of loans that are available.

For a newer business, a traditional mortgage is going to hold the most potential. The caveat is that you, as the owner, must have a good credit score of 700 or more in most cases. The terms of this loan would likely include financing 65% to 85% of the property value and you would need to make a down payment of 15% to 35% of the purchase price. There is no cap on the loan amount and typical term can range from 5 to 20 years. This is a great option for a business which is 1- 5 years old.

Small Business loans are available to more established businesses and have a slightly lower credit score requirement for the owners. They require a score in the neighborhood of 680. The SBA 7(a) loan offers up to 100% financing and a term of 25 years, while the SBA 504 loan provides up to a 90% loan and has a shorter term of 10 – 20 years. The 7(a) has a cap of 5 million while the 504 has no maximum loan amount.

Short term loans are also an option.

There are also a couple of short term mortgage options that you should be familiar with. A commercial bridge loan is a short term loan that is used when you are planning to refinance in the future. These loans have a term of six months to thirty six months and typically have a faster approval time than other loans. The requirements for this loan are not as strict as some others and they are a great fit for a buyer who is looking to renovate and resell a property. The other option is a hard money loan. This loan is often a term of 1- 3 years and is the fastest way to procure a loan if you have a previous commercial borrowing history. Some loans can be approved in just a few days.

Learning to balance what you need with what you qualify for.

Finding the best mortgage to meet your current and future needs is critical. You also need to temper your desires to meet your qualifications and the situation of your business. Having a good personal credit score can position you to have more options but it is important that your business also be in a stable position to maintain the mortgage as well as your operating expenses. Finding that balance will allow you to be successful in your mortgage search and your future profitability.

mark-gowlovech-150x150Dennis 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

Dennis Dahlberg Broker/RI/CEO
NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701   

     Linked In Active Rain     You TubeFace Book         

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.

Technorati Tags: commercial mortgages,commercial loans,commercial lender,commercial hard money lenders texas,commercial mortgage Texas,commercial loan Texas,commercial mortgage Arizona,commercial loan Arizona

What to Expect When Applying for Commercial Real Estate Mortgage

If you have never experienced the process of applying for commercial real estate loans then you could be very shocked. The process is much more in depth than a personal real estate loan or mortgage.

Most consumers are fairly familiar with the process of getting a home mortgage and they naturally believe that securing a loan for a commercial property must be very similar. But the fact is that because most commercial loans are not government backed like personal mortgage loans, the lenders are much stricter in qualifying the eligibility of borrowers. So commercial borrowers need to educate themselves to have realistic expectations.

Most borrowers are going to turn to their most familiar lender when they are considering commercial real estate loans, which is often their bank. Unfortunately, banks often have the toughest eligibility requirements and the longest application process. They will want to see income sheets, balance sheets and cash flow statements dating back several years. It can take several weeks to get even a verbal approval from your bank. And then the application still needs to be approved by the credit committee who can reject the application even after the verbal approval has been given. Seeking other lenders or alternative lenders online might be a good idea and can be used as a backup plan in the event of a rejection from your bank.

Regardless of type of lender that you are applying to, there are certain documents that you will want to have prepared to submit with your commercial loan application. Because there is no government backing on these types of loans, lenders want to be very thorough in their vetting process. They are looking for a certain level of stability from your business and will want to see that documented over a period of 3-5 years. They could request leases, asset statements, the original corporate documents as well as the personal financial records of the business owners. So not only do you need to have your business on stable financial ground but you also need to have your personal finances in order. Having this documentation ready will save time on the application process but be sure to ask for a list of required documents in your first conversation with a lender. This will help you to efficiently select lenders with whom you know you can qualify.

Know What Costs to Expect for a Commercial Mortgage

As you are speaking to potential Commercial lenders, it is a good idea to ask for a complete fee structure list. Many commercial mortgages express fees as interest and points. So be sure that you determine the total of these two fees for the overall rate. Also ask about any legal fees, survey fees, any loan application fee or appraisal costs that you might be required to pay. All of this information will help you to determine which loan is the best suited to meet your needs.

Do Your Due Diligence and Be Prepared when you apply for a Commercial Mortgage

Requesting a commercial loan for a real estate purchase is a big step and one that deserves research and planning. Having a knowledge of the process of a commercial mortgage and the time frame can greatly reduce your stress and increase your potential for getting the loan that you have applied for. This is the next step in the growth and success of your business.

mark-gowlovech-150x150Dennis 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

Dennis Dahlberg Broker/RI/CEO
NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701   

     Linked In Active Rain     You TubeFace Book         

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.

Technorati Tags: commercial mortgages,commercial loans,commercial lender,commercial hard money lenders texas,commercial mortgage Texas,commercial loan Texas,commercial mortgage Arizona,commercial loan Arizona

Understanding Commercial Mortgage Basics

If you are considering buying a business property then you will want to be sure that you are well informed about the different types of commercial real estate loans that are available. This information can be a great help in a successful purchase.

Knowing that you want to buy a commercial property is not even really a first step. It is more of the thought that is motivating you to take the first step. And as in many processes, a first successful step is learning about the process, your options and what to expect. In this case knowing about the different types of commercial real estate loans and their intended purposes can help you to make a smart financial choice.

If you have an opportunity to make a great buy but timing is critical then you should be looking at a bridge loan. This loan is normally for a year or less and is instant cash to get you started on a purchase or major improvement. It allows you to fund the deal and then seek long term loans. To qualify or a bridge loan you will need to have excellent credit, proof of income and demonstrate the ability to cover existing expenses plus the new loan payment.

If you are interested in procuring a long term loan for a property then you will want a real estate purchase loan. This is much like a fixed rate or adjustable rate commercial mortgage. To qualify for this loan you will need credit scores in excess of 700 plus you must have significant business and personal savings. The property must also be used as collateral and the loan rate is determined by the loan to value ratio.

The Hard Money Option

A hard money loan is typically offered by a private lender and for this reason they don’t have to meet the same strict standards as the more mainstream lenders. This means that a hard money loan can carry a very high risk of default and a very high interest rate. This is a way to get money very quickly without slogging through the long process of a traditional commercial mortgage application process. Many times once hard money is used to secure a property, then the borrower begins to seek a more traditional loan to refinance as a hard money loan is often for a very short term.

Know Your Options and Choose Wisely

There are many different types of commercial loans that are available. Some are designed to be short term and other are more long term. In many cases the term of the loan that you are looking for is determined by the use of the money. So matching the right type of loan to the right project will offer you the best opportunity for success and profit. In the long run, you are trying to find the best balance of interest rate and cost of the loan as it compares to the difficulty and time it takes to get the loan. Having a good understanding of the process will help you to make the best selection to fit your current project.

mark-gowlovech-150x150Dennis 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

Dennis Dahlberg Broker/RI/CEO
NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701   

     Linked In Active Rain     You TubeFace Book         

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.

Technorati Tags: commercial mortgages,commercial loans,commercial lender,commercial hard money lenders texas,commercial mortgage Texas,commercial loan Texas,commercial mortgage Arizona,commercial loan Arizona

Understanding Commercial Mortgage Basics

Most consumers are familiar with the personal mortgage process but there is more to a commercial mortgage than just a larger dollar amount. Knowing the differences can help you decide if you are ready to apply for this type of loan.

A commercial loan is used to purchase business structures such as office buildings, apartment complexes, health care facilities and retail space. And due to the large size of the property and the large price tag, buyers need a loan to make the purchase just a person gets a loan to buy a house. So there are some similarities to a personal mortgage but a commercial mortgage is also very different in some ways. The similarities are very basic, you need to apply for the loan and you need to provide collateral for the loan but the size and value begin to make the commercial loan more difficult to obtain.

Collateral is what is used to secure a loan, and in the case of a mortgage, it is the property itself which is the collateral. Because commercial property values can fluctuate very rapidly, a commercial loan is most often only offered for around 75% of the property value. This ensures that there is equity in the property if the borrower defaults on the loan and the lender needs to recover their money. This value fluctuation also makes it very critical that there is a very in depth appraisal completed on the property to determine the market value.

In addition to verifying the property value the lenders take a very hard look at the financial situation of the business who is making the purchase. If the company does not have previous commercial loan experience and good credit then the lenders will request the personal financial information from the owners of the business. This is done so that the lender knows that the business owners can guarantee the loan if the business itself fails.

Things to Consider About the Interest Rate

When you apply for a loan you will want to determine if you are looking for a fixed rate loan or a variable rate. This is much like a personal mortgage but the difference is that many commercial loans are offered for a shorter time frame than the personal loans. This means that the amortization is longer than the actual loan and you will be facing a large balloon payment at the end of the loan term.

Read the Fine Print to Learn the Real Deal

There can be a lot of important information tucked into the pages of a commercial loan document. You need to be sure that you understand all of the terms of the repayment as well as any caveat for early repayment or default. You will also want to understand the personal implications if the business fails and is unable to repay the loan. Having a complete understanding of the basic process will ensure that you can manage your expectations and make a successful commercial real estate purchase.

mark-gowlovech-150x150Dennis 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

Dennis Dahlberg Broker/RI/CEO
NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701   

     Linked In Active Rain     You TubeFace Book         

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.

Technorati Tags: commercial mortgages,commercial loans,commercial lender,commercial hard money lenders texas,commercial mortgage Texas,commercial loan Texas,commercial mortgage Arizona,commercial loan Arizona