How to Get the Best Rates
It is the quest of any borrower to look for the best rates while borrowing money. If it is a commercial project, it is all the more reason that the interest rates should be as low as possible. When it is a commercial property the money can be got back only after the property has been completed and sold. In such a case getting a loan at the lowest possible interest is the prime aim.
Where To Get The Best Rates
Before we set out to seek the best commercial mortgage rates, we need to see the main differences between getting a loan from a bank and from a private money lender.
Banks typically have a lot of conditions before they can lend you money. Banks will need a very strong credit score for lending you money. They will need to see a fixed income source. But with a private lender they calculate the income differently and are flexible with the requirements.
When dealing with banks you will need a mortgage broker. With private financing companies this is avoided as they sell their own products.
Another major hurdle with banks is the need to stick to certain guidelines fixed government agencies like Fannie Mae, Freddie Mac, FHA, VA, USDA etc. With private lenders the procedures are very flexible based on your relationship with the lender.
Not all types of property are covered by banks for loans. Private money lenders are willing to consider any non-conventional type of property for the sake of advancing money.
Interest rates are certainly lower with banks, but the strict formalities and conditions make people go to private money lenders. There are private lenders who offer almost the same interest rates.
Why Go To Private Money Lenders?
Customers like to go to private money lenders for the easier and simpler formalities. A strict requirement of good credit score is not a must. While banks may insist on a 720+ score private financiers like New City Financial will offer loans at 650+ mid FICO score.
New City Financial also offers are very nominal interest rate of 6.74% on commercial mortgages while making the procedures simple and fast.