Commercial Property Mortgages – There Are Funding Sources Out There
There are different commercial mortgage lending sources for business owners, each one with their benefits and disadvantages. If you are looking to acquire a mortgage loan for a commercial property, there are lots of options available to you. The following are the various sources of acquiring commercial property mortgages.
Savings and Loan Associations
Although these are not the largest when it comes to assets, they are certainly the primary source of funds for commercial property financing. This association makes savings and loans available for commercial real estate, industrial property, and business premises. While their importance and value in the industry has depreciated over the years, they still maintain a significant share of the mortgage market. Savings and loans lending policies may differ from one association to another, but most of them still have the same lending requirements like other conventional lending institutions.
Commercial banks are surely the largest intermediaries for commercial property mortgages. They have different types of loan packages to meet the different needs of customers. Some larger commercial banks even have a separate real estate department for dealing with all issues related to commercial property mortgages.
Insurance companies have now expanded their roles of not only providing indemnity for loss, but also offering commercial mortgage services. However, they do not directly get involved or deal directly with the borrower, but through local correspondents (mortgage banks or mortgage brokers). Insurance companies usually get more involved in large scale mortgages.
Although they work as financial middlemen, mortgage bankers offer more services than just bringing investors and borrowers together. They usually create loans, package them, and sell to both lenders and investors. In most cases, they help facilitate loans between the investors and lenders and also serve as the warehouse for mortgaged money.
There are other commercial property mortgage sources such as mortgage brokers, mutual saving banks, pension funds, as well as financial companies. Before you set out to get a loan from any of these sources, you should find out about their services and areas they cover.