The Basics Of A Commercial Mortgage
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James Copper
Apr 26, 2013, 6:45:55 PM4/26/13
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Article Title: The Basics Of A Commercial Mortgage
Author: James Copper
Word Count: 514
Article URL: http://www.isnare.com/?aid=142750&ca=Finances
Format: 64cpl
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A commercial mortgage is a mortgage for a building that will be used for business. Commercial mortgages are like a residential mortgage, but can differ in a few ways. Commercial mortgages are a little riskier than a residential mortgage. They are not for someones home, but rather for business use, usually a start up business which in and of itself produces a risk to the lender.
Commercial mortgages require the same steps as a residential mortgage. However, with a commercial mortgage if the business has an established line of credit separate form the individual business owner, then the businesses credit is used to secure the loan.
Commercial mortgages can have a fixed or variable interest rate. A fixed rate will stay at the same percentage for the life of the loan. A variable rate will change as interest rates change. With a fixed rate the benefit is that a person will always know the cost of their mortgage payment, however, a variable loan allows a person to take advantage when rates drop, immediately.
Fixed rate mortgages though can be refinanced when rates drop and therefore the rate will be fixed at that lower rate. The choice can be difficult and should be discussed with the lender to ensure the best one is chosen for the circumstances of the business.
When applying for a commercial loan a business owner should make sure they have all of their financial information prepared and documentation ready for when they meet with the lender. If it is a start up business then they will need their personal financial records. They will also need a comprehensive business plan including business finances.
If the business is already established and has its own line of credit then the business owner will only need to provide the businesses financial information. It is best to be prepared with income taxes from the last two years for both the business and business owner.
Commercial mortgages are pretty much a lot like residential mortgages. The basics of the mortgage terms are the same. The main difference is the documentation used. When applying for a commercial mortgage a business owner needs to ensure they are well prepared to offer the documentation to prove their business is going to do well or has been doing well.
The lender is mainly interested in seeing that the business is not likely to go under any time soon. If they have any doubts it could cause problems with getting the loan. Additionally, the business owner should be willing to put up some type of collateral to secure the loan, as this will make lenders more likely to consider approving the loan. Anything a business owner can do to ensure the loan will be repaid is worth doing.
Business loans of any type are often considered risky for a lender so they are extra careful in approving them. This is important for a business owner to keep in mind when searching for their commercial mortgage loan.
About The Author: James Copper writes on all areas of finance and investment. He works for CFS who source http://www.commercialfinancespecialists.co.uk commercial mortgages for business owners and people looking to starting their business.
Please use the HTML version of this article at:
http://www.isnare.com/html.php?aid=142750
*********************** ARTICLE END ***********************
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Message delivered directly to members of the group:
publish-the...@googlegroups.com
*****************************************************************
Please consider this free-reprint article written by:
James Copper
*****************************
IMPORTANT - Publication/Reprint Terms
- You have permission to publish this article electronically in free-only publications such as a website or an ezine as long as the bylines are included.
- You are not allowed to use this article for commercial purposes. The article should only be reprinted in a publicly accessible website and not in a members-only commercial site.
- You are not allowed to post/reprint this article in any sites/publications that contains or supports hate, violence, porn and warez or any indecent and illegal sites/publications.
- You are not allowed to use this article in UCE (Unsolicited Commercial Email) or SPAM. This article MUST be distributed in an opt-in email list only.
- If you distribute this article in an ezine or newsletter, we ask that you send a copy of the newsletter or ezine that contains the article to http://www.isnare.com/eta.php?aid=142750
- If you post this article in a website/forum/blog, ALL links MUST be set to hyperlinks and we ask that you send a copy of the URL where the article is posted to http://www.isnare.com/eta.php?aid=142750
- We request that you ask permission from the author if you want to publish this article in print.
The role of iSnare.com is only to distribute this article as part of its Article Distribution feature ( http://www.isnare.com/distribution.php ). iSnare.com does NOT own this article, please respect the author's copyright and this publication/reprint terms. If you do not agree to any of these terms, please do not reprint or publish this article.
*****************************
Article Title: The Basics Of A Commercial Mortgage
Author: James Copper
Word Count: 514
Article URL: http://www.isnare.com/?aid=142750&ca=Finances
Format: 64cpl
Contact The Author: http://www.isnare.com/eta.php?aid=142750
Easy Publish Tool: http://www.isnare.com/html.php?aid=142750
*********************** ARTICLE START ***********************
A commercial mortgage is a mortgage for a building that will be used for business. Commercial mortgages are like a residential mortgage, but can differ in a few ways. Commercial mortgages are a little riskier than a residential mortgage. They are not for someones home, but rather for business use, usually a start up business which in and of itself produces a risk to the lender.
Commercial mortgages require the same steps as a residential mortgage. However, with a commercial mortgage if the business has an established line of credit separate form the individual business owner, then the businesses credit is used to secure the loan.
Commercial mortgages can have a fixed or variable interest rate. A fixed rate will stay at the same percentage for the life of the loan. A variable rate will change as interest rates change. With a fixed rate the benefit is that a person will always know the cost of their mortgage payment, however, a variable loan allows a person to take advantage when rates drop, immediately.
Fixed rate mortgages though can be refinanced when rates drop and therefore the rate will be fixed at that lower rate. The choice can be difficult and should be discussed with the lender to ensure the best one is chosen for the circumstances of the business.
When applying for a commercial loan a business owner should make sure they have all of their financial information prepared and documentation ready for when they meet with the lender. If it is a start up business then they will need their personal financial records. They will also need a comprehensive business plan including business finances.
If the business is already established and has its own line of credit then the business owner will only need to provide the businesses financial information. It is best to be prepared with income taxes from the last two years for both the business and business owner.
Commercial mortgages are pretty much a lot like residential mortgages. The basics of the mortgage terms are the same. The main difference is the documentation used. When applying for a commercial mortgage a business owner needs to ensure they are well prepared to offer the documentation to prove their business is going to do well or has been doing well.
The lender is mainly interested in seeing that the business is not likely to go under any time soon. If they have any doubts it could cause problems with getting the loan. Additionally, the business owner should be willing to put up some type of collateral to secure the loan, as this will make lenders more likely to consider approving the loan. Anything a business owner can do to ensure the loan will be repaid is worth doing.
Business loans of any type are often considered risky for a lender so they are extra careful in approving them. This is important for a business owner to keep in mind when searching for their commercial mortgage loan.
About The Author: James Copper writes on all areas of finance and investment. He works for CFS who source http://www.commercialfinancespecialists.co.uk commercial mortgages for business owners and people looking to starting their business.
Please use the HTML version of this article at:
http://www.isnare.com/html.php?aid=142750
*********************** ARTICLE END ***********************
- To distribute your articles go to http://www.isnare.com/distribution.php
- For more free-reprint articles go to http://www.isnare.com
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