Commercial mortgage loan Types

Commercial mortgage loans are a great way for businesses to secure financing to purchase or refinance commercial properties. There are several types of commercial mortgage loans available, each with its own unique benefits and drawbacks. In this post, we'll explore the different types of commercial mortgage loans and what you need to know about each one.

Traditional Commercial Mortgage Loans

Traditional commercial mortgage loans are the most common type of commercial mortgage loan. These loans are offered by banks and other financial institutions and are typically used to purchase or refinance commercial properties such as office buildings, retail spaces, and warehouses. Traditional commercial mortgage loans typically have fixed interest rates and repayment terms ranging from 5 to 20 years.

Small Business Administration (SBA) Loans

Small Business Administration (SBA) loans are a type of government-backed commercial mortgage loan. These loans are designed to help small businesses secure financing to purchase or refinance commercial properties. SBA loans typically have lower down payment requirements and longer repayment terms than traditional commercial mortgage loans. However, the application process for SBA loans can be more complex and time-consuming.

Bridge Loans

Bridge loans are a type of short-term commercial mortgage loan that is used to bridge the gap between the purchase of a new property and the sale of an existing property. Bridge loans typically have higher interest rates and shorter repayment terms than traditional commercial mortgage loans. However, they can be a great option for businesses that need financing quickly.

Hard Money Loans

Hard money loans are a type of commercial mortgage loan that is typically used by real estate investors and developers. These loans are secured by the property being purchased and typically have higher interest rates and shorter repayment terms than traditional commercial mortgage loans. However, hard money loans can be a great option for businesses that need financing quickly or have poor credit.

Conclusion

When it comes to commercial mortgage loans, there are several options available to businesses. Traditional commercial mortgage loans, SBA loans, bridge loans, and hard money loans all have their own unique benefits and drawbacks. It's important to carefully consider your options and choose the type of loan that best fits your business's needs and financial situation.