Need Cash Now? You May Consider Commercial Property Refinance
Commercial property refinance takes similar steps like any other loan. Both your income level and creditworthiness will be considered. However, if you need money for business purposes, for personal wealth, or for investment, commercial property refinancing is a great alternative. If you are looking for cash for any of the above reasons or for other reasons, below is a guide to assist you when considering commercial property refinance.
Prepare your documents
Surely, presentation of documents will be one of the key features of mortgage refinancing. You need to get all your documents ready, because the lender is going to ask for a lot of them. You need to present financial statements, profit and loss statements, bank records, and the business’s tax returns. All these will be needed by the lender to evaluate your credit worthiness. Apart from the financials of the business, the lender might ask for a form of guarantee (collateral) on the loan from one or more of the business primary owners in cases where profits are marginal. Before considering commercial loan refinance, you need to have all the documents ready and properly updated to have a stress-free negotiation.
Commercial property refinancing is usually more expensive than consumer lending. You need to spend on closing costs, original fees and inspections. Also, carrying out appraisal on the property alone can cost anywhere from $2,000 to $7,000, depending on the size of the property. So you have to determine whether refinancing will be cheaper or take other alternatives. These and other costs you may incur should be factored into breaking even.
Applying for the Mortgage
After getting your documents ready and determining the cost of the mortgage, the next step is to apply for the mortgage. This is a huge financial decision and you should not be in a hurry to select the plan or mortgage firm that looks attractive. Carry out your research diligently, and make sure the lending firm has positive reviews. You can get a lot of information on the right company and their different lending rates.
In the end, select the mortgage firm that provides the best plan for you in terms of costs and repayment structure.