Hunt for the Best Commercial Mortgage Rates
The common way for many businesses is to lease out commercial property. However, you can have several advantages if you decide to just buy a commercial property on a mortgage. You have more flexibility of monthly payments by adjusting tenure, and at the end, you own the property. Besides adding to your business assets, this also means you don’t have to clear any renovations or layout changes with your landlord.
The financial benefits are highly dependent on the interest rates that you are able to get. Even half a percent can add up to thousands of dollars over a long term. Hence, you must aggressively try to get the best interest rates you can. Here are a few tips that will help you with getting best commercial mortgage rates.
Take time to calculate the best terms
You will have a greater flexibility to pick your terms when you get a mortgage compared to rental. However, you must make the maximum use of this flexibility to your advantage. If you have a business that can generate a long-term income, then you can go for a longer repayment period. However, this will also add up a lot of interest over the years. But if your business is highly opportunistic and you can start turning immediate profits, get a shorter term loan. If the quick and limited time profits cover the high instalments, you will quickly have your own property, which is an asset as you look for a newer opportunity for business.
Have perfect bookkeeping
Lenders like clean accounting. If you have messy financial records, it is not only hard to decipher, but also reflects a certain level of carelessness. When you show the account records to lenders, they may underestimate your ability to lead a successful business. Hence, it is best to hire a professional accountant to make prepare accounts and ensure that the generally accepted accounting principles are followed.
Location, location, location
The location of your commercial property is important for determining its value. While getting a property in a high demand area may be expensive, from the lender’s point of view, it is a safer investment. You can even lend it out for a decent rent if your business is in trouble. So you may be able to get better interest rates.