How Do Commercial Bridge Loans Work?
Commercial borrowing can be full of barriers and pitfalls. Most business owners don’t have ready cash needed to expand, move to a better location, or purchase equipment. For any number of reasons commercial lenders may be reluctant to provide financing and the owner ends up stuck. Shop Commercial Mortgage has commercial bridge loans available for owners with free and clear equity in commercial properties.
A commercial bridge loan can be valuable for investors purchasing properties for renovation and resale. Conventional lenders are often reluctant to finance a property that will be resold in just a few months. Shop Commercial Mortgage can provide commercial bridge loans to qualified borrowers. The same advantage of using our services applies when investors need to move quickly to secure financing for a commercial property in high demand. Having to wait months for conventional lenders can eliminate many favorable properties from consideration.
Generally, our bridge loans are intended to be repaid within one to two years maximum. They are not intended for long-term financing as our investors are looking for other future investment opportunities with their funds. The collateral for the loan can either be an existing property or the one being purchased in some cases. You should discuss your options with us at Shop Commercial Mortgage before committing to the purchase.
The financing is also based on a loan-to-value (LTV) ratio which will never be the full amount of the property’s price. Shop Commercial Mortgage typically sets our LTV ratio at 55%. Therefore borrowers must be prepared to supply the balance of funds needed for the commercial property purchase.
If you are a commercial borrower who is having problems obtaining financing for an existing or desired property, contact Shop Commercial Mortgage today at 855-960-6070 and learn more about our commercial bridge loan financing.