Differences between commercial and residential loans
One of the key differences between commercial real estate loans and residential real estate loans is that the former tends to be larger in size and have more stringent underwriting requirements. This is because commercial properties are typically more expensive than residential properties, and generate income that needs to be factored into the underwriting process.
What kind of commercial real estate loans are there?
There are a few different types of commercial real estate loans. The most common is a traditional commercial mortgage, which is similar to a residential mortgage in that the borrower provides a down payment and the lender provides the rest of the funds to purchase the property. Another type of commercial real estate loan is a bridge loan, which is a short-term loan that is used to bridge the gap between the purchase of a new property and the sale of an existing property. At Summit Lending, we offer a variety of products to suit your needs.
How do I qualify for a commercial loan?
One of the key factors that lenders look at when underwriting a commercial real estate loan is the borrower's creditworthiness. This includes factors such as credit score, income, and debt-to-income ratio. Lenders also look at the property's income potential, as well as its location, condition, and market trends. Another important factor to consider is the property's cash flow. Lenders will want to see that the property is generating enough income to cover the loan payments. They may also require a detailed financial analysis of the property, including the income and expenses.
Commercial real estate loans can be a valuable tool for businesses and investors looking to purchase or refinance commercial properties. Contact Summit Lending today so we can help ensure that you get the financing you need to achieve your business or investment goals.
