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Explore various commercial property loan options with Biz2Credit. Learn about financing solutions for purchasing, refinancing, and improving commercial real estate, along with eligibility requirements, interest rates, and application tips.
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Commercial Property Loans: Unlock Your Real Estate Potential
Understanding Commercial Property Loans Commercial real estate financing is designed to help businesses acquire, develop, or refinance commercial real estate. You can use a commercial property loan to finance everything from office buildings to retail spaces, warehouses, and even multifamily housing. If you’re used to residential loans, you may be surprised to learn that commercial property loans have more stringent qualifications and higher interest rates.
Types of Commercial Property Loans 1.Traditional Commercial Mortgages Traditional commercial mortgages from banks and other lenders are used to buy commercial real estate. Commercial mortgage rates can be either fixed-rate or adjustable-rate.Traditional commercial mortgages are often used to buy office buildings, retail spaces, warehouses, or multifamily housing properties.
2.Sba Loans Small Business Administration (SBA) loans are similar to traditional loans, except they are backed by the SBA, which reduces risk for lenders. As a result, you can typically get a lower rate and better terms with these loans. On the flip side, the requirements for qualifying are more stringent. The two types of SBA loans that can be used for commercial property are the SBA 7(a) and the SBA 504.
3.Bridge Loans Bridge loans are designed to “bridge” the gap between your need for financing and a long term solution. These are short term loans that can give you fast funding, but have higher interest rates and repayment terms that range from six months to three years.
4.Hard Money Loans Where bridge loans are short-term, high-interest loans from banks and financial institutions, hard money loans are short-term, high-interest loans from private lenders. Hard money loans are typically used by professional real estate investors who need to move fast on an opportunity. These loans are secured by the property itself, so they are available even if you don’t have a strong credit history.
