Most people are familiar with the process used to gain a residential mortgage for the purposes of purchasing a home, which seemingly never-ending monetary obligation the homeowner must make until that loan is paid in full. Perhaps you remember your parents, or a relative, celebrating the payment in full of that loan by having a “mortgage burning celebration”.
Procuring a loan for the purpose of purchasing a building, maybe to be used as a family business, or a retail store, can be a rather arduous process. You must have all your finances and paperwork in order before you even attempt to begin that venture. Is this a daunting task? Well, you could make it easier on yourself if you secure the help of an expert who specializes in loans for retail construction. Such an expert would be instrumental in paving the way for a potential future business owner to achieve a commercial loan with minimal obstacles to that ultimate goal.
A commercial mortgage is a business-related loan, as opposed to a loan procured for the purpose of purchasing a home. A commercial mortgage may be used for a business venture, or as an investment. If you’ve waded through the process of obtaining a loan for a home, you still need to deal with a lender (a bank or loan institution), but, in this case, instead of the borrower being the potential homeowner, it is the potential business owner. This potential business owner is not always an individual – it may be one or more business partners attempting to start a business, or, it might become a family-related business. Commercial mortgages are not just for buildings, as the funds may be used to develop or purchase land.
SBA 504 Loans: “Owner Occupied” commercial mortgage. You’ve probably heard the commercials about just how easy it is to obtain a SBA loan to fulfill the dream of having your own business. Since its inception in 1953, the United States Small Business Administration (“SBA”) has delivered millions of loans, loan guarantees, contracts, counseling sessions and other forms of assistance to small businesses. Most potential business owners feel the most comfortable with the 504 Program which is considered the best way to purchase “owner occupied” commercial real estate with a minimal amount “down”.
Most 504 first mortgage loans are only fixed for a period of time before they are adjusted, i.e. typically 5 years, so they are a very preferable option to lock in the mortgage costs for the long term, especially when rates are low.
Why not consult with a financial expert today to see if a small business loan is the perfect solution for you?