What is Commercial Real Estate Mortgage Loan?

Commercial mortgage loan is a type of commercial loans, which is secured against commercial real estate. Means, commercial property is used as collateral to secure repayment against the allotted loan. Commercial mortgage loan is almost similar to residential mortgage loan, in case of commercial mortgage, collateral is commercial property rather than residential property.

Below are basic features of the commercial real estate mortgage loan:

• The mortgage loan is typically taken by business instead of any individual
• The borrower may be a partnership, small business entity, incorporated business, or limited company
• Lender’s income or benefit is the interest that he charges on the amount of loan provided to borrower
• Acquiring commercial mortgage loan is more complicated rather than residential mortgage loan
• In case of failure in repayment by borrower, the lender have the right to seize the collateral
• After paying off the loan, lender neither can seize the property nor can he claim for any deficiency

You can get mortgage loan from any Government guaranteed institutions or any other private institution. But better is that you apply in any Government approved institution. This type of loans is good for lender to secure the repayment of loan.

Due to terms & conditions, lenders don’t take much time to get agreed to provide loan. The reason behind this is that the terms & conditions of loan make repayment of loan much secure.

Blogs related to Commercial Property Loan:

Sources of Getting Commercial Property Loan

Tips to be followed before applying for Commercial Property Loan

Tips to be followed before applying for Commercial Property Loan

Three most important tips before apply for commercial property loan. This blog post will let you know the 3 useful pre-steps to be followed when applying for loan. These three steps include Credibility, Down-payment and PFS. A brief description of these factors has been provided below:

Credibility:

Credibility is very important before going to any financial institution or doing any type of paper work. Your credit report should have a score, means you shouldn’t be under any Judgment, Bankruptcy, or any other criminal cause.

Down payment (15% to 20%):

You must have cash as down-payment. The cash must be at least between 15 to 20 percent of the total property wealth. You need to show some cash to financial institutions and that you are able to purchase commercial real estate.

Attractive PFS (Personal Financial Statement):

PFS is very important for financial institutions. It should be very attractive. Financial institutions give prior importance to PFS (Personal Financial Statement) for determining and committing the loan amount. Your PFS may include assets such as property, insurance claim, liquid assets, and more. These assets should be heavy in worth, but not in quantity.

Get your doubts cleared by reputed real estate consultants in any metro city. Above mentioned content is only informative and not a legal advice related to real estate loan or any there activities.

Commercial Property Loan, Step-by-Step General Loan Processes

This blog will let you know the general processes of commercial loan. These loan processes can help you map out your time and money. People get frustrated and irritated, when they don’t have an idea about the entire process of getting loan from lenders. Below is the step-by-step basic overview of loan process:

• First, submit the loan application to lender
• After going through your loan request, the lender will ask for some information like credit report, income and existing debts
• Once you provide the asked information, a loan officer will review your credit report, amount of available collateral and income
• After a review, lender will decide if any other information is required like financial statement, property report you owning, etc.
• Preliminary environmental reports, title reports, area maps, lease summaries, and property appraisals may also be asked by lender
• Once the above mentioned formalities are done, your loan package will be submitted to decision makers. After a decision, the processor will present you a letter of intent or term sheet
•  In this step you will be asked to choose a most attractive loan offer. After signing the letter of intent, you have to return it along with a Cheque, if required. After receiving letter, the lender will issue a final full loan commitment
• If your loan is approved, you will receive closing documents 
• After the closing process, the lender funds the loan with a draft/cashier’s cheque, or electronic wire transfer

Above are some basic processes of getting loan from lender whether you apply for commercial property loan, business loan, or buy commercial land. Loan can be applied either by yourself or through property dealers in Delhi, India, America, Australia, or anywhere.