Find a Good Deal on Commercial Loans

If you are going to get involved in commercial real estate investing, one of the most important things is going to be getting good financing. Whether you are going to make this purchase for a piece of property for yourself, you plan on selling it for profit, or you want to rent the property, unless you can afford to pay for the entire purchase yourself, you'll need to find good financing. Most people are not able to pay for commercial real estate on their own, so finding a great commercial loan is going to be important.

So, let's take a look at how you can get a commercial loan, and how to get the best deal possible when you are trying to get a good loan for your commercial real estate. When you are trying to find a great deal on a commercial loan, you'll need to remember that lenders want to insure that they are going to give the money to good buyers. If you are going to try to get the lenders to give you the loan that you want, it's important that you have all the documentation available to show them that you are serious about the commercial real estate and the loan that you need as well.

Here are a few of the things that you'll need if you are going to get a great deal on a commercial loan today.

-Great Credit

The first thing that you are going to need if you are looking for a commercial loan is great credit. It's going to cost a lot of money to finance a piece of commercial property and even if you have experience and great income, most lenders are going to be leery of giving you a loan if you have bad credit. Your credit should not have late payments on it and you shouldn't have bankruptcies on your credit either. Before you apply for one of these loans, it's a great idea to find out what your credit score is to make sure that you do have great credit. If not, find a partner who does.

-A Good Down Payment

A good down payment is also going to be important if you are going to be able to get the commercial loan that you need. In fact, the more you can pay down in the beginning, the better deal you'll get on the loan that you need. Usually lenders are going to require between 10-30% down on the property before they'll give you a loan. So, be prepared to make a down payment that is quite large if you want a great deal.

-Quality Business Plans

Quality business plans are very important as well if you want a great deal on commercial loans. This is a great way that you can impress lenders. You need to show them how you are going to succeed and make money once you have the commercial property.

-Experience

If you are an investor in the real estate market, then you'll want to show off your experience. Experience is important if you want to get a great commercial loan out there. Some lenders are a bit hesitant to lend out money to people who are new to the business.

-Extra Income

Having other income to show when you are applying for a commercial loan is a great way to get a great deal as well. You're loan application will look a whole lot better to lenders when you have other income, since this shows lenders that you are more likely to make sure that they get paid their money on time.

If you are missing any of the elements above, find a partner who has them - someone who can help secure the financing and/or help lend the experience needed run your property successfully.

You'll find that most commercial loans come with high interest rates and they also have terms that are quite short, so it's important that you are going to be able to pay them off quickly. Know that you'll actually have the money to pay this loan before you take it out. If you want a great deal on the commercial loan, it's also important to consider various lenders. Although there are not as many options available when it comes to commercial lenders, you'll find comparing lenders can help you to find the best deals possible. Of course the best way to get a great deal is to make sure that you know what you're doing so that you can show that you'll do well with the money and that you'll be good for it when it comes time to pay it back as well.

James Janel is the Executive Director of the National Association of Commercial Real Estate Property Scouts. He is a Professional Property Scout, as well as an experienced commercial real estate investor. To find out more about property scouting and real estate investing, or to request our free report, Prospecting for Profits: Turning Dirt into Cash, go to http://www.NACREPS.org

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