Commercial Real Estate Loan Options

There are various types of commercial real estate loans that will help you get into this burgeoning sector of investment strategies. Learn about bridge loans, joint venture and hard money loans.

Commercial property is, simply put, property that produces income. It can be just about anything including, but not limited to, industrial, office, hospitality, medical and amusement. According to Statista, the value of total commercial construction starts in the United States amounted to 18.66 billion U.S. dollars—and that was just the first half of 2017. Yet only 8 percent of Americans own investment properties and only 7 percent of those investors put down more than 50 percent when purchasing properties. Here are just a few of the many ways you can access lenders in order to obtain your commercial real estate loan.

A bridge loan supplies needed cash, allowing an investor to keep their current asset while purchasing the next. It is commonly used to finance initial construction or put money down on a project while awaiting more traditional forms of lending. These are short-term loans, usually 3 to 12 months that provide immediate cash flow. Hard money lenders usually offer these types of “fast cash” loans. Hard money loans are also short-term loans, though they can often be extended for up to 5 years. They require collateral and lenders are more concerned with the value of the property than with the borrower’s credit score. They do require a business plan and an exit strategy.

Joint venture financing is, in essence, taking on a partner for a specific project. In this type of commercial real estate loan, parties share in costs, profits and losses. This type of loan can be complicated and requires understanding in the following areas: the type of entity the joint venture will be such as an LLC, the responsibilities of each party in the day-to-day operations, the equity stake each partner holds and an exit strategy. It’s important to understand that, ultimately, you are taking on a partner who will have a say in the development of your—and your investor’s—project.

Compatibility issues as well as differing opinions have derailed many a joint venture, making it important to establish trust and good lines of communication in the early stages. Many choose this option when expanding into new territory, and smaller projects may undertake a joint venture agreement in order to participate in larger projects and have access to their now partner’s technology or resources.

How to Determine the Best Commercial Real Estate Loan for Your Business

If you need a partner for their expertise and resources, a joint venture may be your best option. Make sure they compliment your skills and experience and have a good track record. If you need immediate funds to get your project started while you wait the month or more for traditional funding, a bridge loan may be your answer. For those real estate investors that require immediate financing, have a strategic business plan and exit plan in place, and for others looking to do a quick flip, a hard money loan may be your best choice. This is also a good alternative for those with credit issues.

“Twenty years from now you will be more disappointed by the things you didn’t do than by the ones you did.”

—Mark Twain

If you’d like help determining the best type of loan for your next or first project, call us at Level 4 Funding. We are happy to share our years of experience and the knowledge we’ve gained in order to help you get stated in this type of investment strategy.

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701

About the Author:  Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

A Win-Win Situation: Commercial Lending with a Private Hard Money Loan

Commercial lending with hard money loans, also known as private loans, offers several advantages over traditional loans. They base their loans on collateral as compared to credit scores, fund in as little as two days compared to more than a month, and can offer flexible terms.

In some instances, a business or real estate investor will not qualify for a traditional loan due to the stringent credit and capacity requirements of a bank. They do, however, have available collateral. A hard money lender can provide a win-win situation. The loan is acquired and the lender earns above-average returns.

In other instances, it is not concern about creditworthiness that leads real estate investors, contractors, businesses and home owners to search for personal and commercial lending through a hard money lender, but the time constraints that they are under. An investor may have found a property perfect for renovation or a quick fix and flip and needs to have cash in hand in order to fund the project before someone else beats them to it. A business may need immediate funds for equipment or operations and can’t wait the month or more than a traditional lender requires. A home owner may want to put money down on their new home before selling their old one in order to ensure their bid is not rejected due to a contingency sale.

Private lenders are not under the same regulatory scrutiny that banks are in regards to commercial lending. They do not have to fill the more stringent FDIC and government mandated lending requirements that conventional banks do. This gives them flexibility in lending and allows them to structure repayment in ways that will help the borrower succeed. In most instances, there are no prepayment fees as often seen in traditional financial institutions, giving the borrower the ability to pay off the loan early should their home sell in record time or their latest fix and flip take less time to rehab and a buyer is found in days instead of months. With one loan under their belt, they then go on to the find and fund their next project and a mutually beneficial “partnership” has formed.

Why Work with a Mortgage Broker?

When delving into the world of commercial lending, working with a hard money loan mortgage broker may be your best consideration. They generally work with a lot of investors and can often find a way to qualify you for a loan when other banks and lenders cannot. Stricter requirements and more education and experience are required for those who are licensed mortgage brokers as compared to that of mortgage banker, so it is best to seek the advice of the former when looking into this type of loan. In addition, choose one who has stood the test of time. Not only do they have more experience, they also have more contacts and investors that they can choose from to help you develop your project or succeed in your business.

Brokers are mortgage experts. They’ve worked with countless investors and know which loans are appropriate for different types of projects and properties.

At Level 4 Funding, we have a great team of professionals that can get you the right hard money loan for your needs at the best possible rate. Call us for a consultation and to discuss your unique project and needs.

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701

About the Author:  Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

A Traditional Commercial Mortgage Lender versus a Commercial Hard Money Lender

A traditional commercial mortgage loan is not always easy to attain. Fortunately, there are alternatives, and one of those is funding through a commercial loan from a hard money lender.

Since the subprime mortgage crisis, obtaining a commercial mortgage loan has been difficult at best and impossible at worst. Though the noose is loosening, its grip can still be felt in increased regulations, restrictions and requirements that make it difficult for the best of businesses to qualify. These types of commercial loans include SBA 7(a), CDC / SBA 504 loan, and traditional mortgage. Most of these types of loans require an established business presence, a credit score in the 700 plus range and experience in similar types of projects. Fortunately, there are alternatives. And one of the alternatives many businesses and real estate investors are turning to is hard money loans.

Hard money commercial mortgage loans are not just for those breaking into the business or individuals with credit scores below the 700 mark, they are also good for borrowers who are competing with all-cash buyers and need to move fast on a specific bid or project. Hard money loans close in as little as a few days compared to the one to two months that an average traditional lender takes, and prequalification takes as little as 24 hours. In some instances, investors will obtain a hard money loan in order to begin a project and will refinance to a long-term commercial loan at a later date.

A hard money lender uses the property’s collateral to secure the loan and not the borrower’s financial position. They are short term loans but can be extended up to 5 years. Questions that you want to be sure to ask a hard money lender include:

· Is there an exit fee or prepayment penalties? Many contractors and investors want to pay off the loan once a sale or traditional refinanced loan is in place.

· What is the late fee on a late balloon payment? Plans don’t always go as intended.

· What type of loan program is best suited for my needs? If you project is a quick turn-around such as a fix and flip, you and your company may be better suited for a bridge loan. An experienced hard money lender will know what loan is best for what you have in mind.

What are Commercial Mortgage Loans used for?

As their name implies, these types of loans are used for commercial real estate properties. The various groups or types of buildings include multifamily, office, retail, industrial, hospitality, healthcare and miscellaneous such as storage. With increased demand resulting in higher rents and occupancy rates, multifamily units, the most common of which is an apartment, are a hot item among real estate investors in today’s market.

Be sure you are working with a lender that has your best interest at heart. This is a relationship you will want to maintain for years as you grow your portfolio.

At Level 4 Funding, we will not only help you close one deal, but grow your portfolio as well. We are invested in you as a client and want your success. Our rapid, streamlined approach helps keep you on track and your business on the path to success.

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701

About the Author:  Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Consider These 4 Factors When Expanding Your Business With Commercial Loans

Expanding your office or investing in new assets with a commercial loan should be huge wins for your company. The process can be complicated, so be sure to do your homework first.

As your company’s leadership begins to chart out a course for 2018, it is likely that talk will come up of expanding your business. With the help of a commercial real estate loan, your company would have funds to expand your footprint with a new location, renovate existing office space or invest in separate real estate assets as new sources of revenue. Having a project financed is no small logistical matter, however. Extensive planning and strategizing will be necessary to make the most of such an investment.

With this in mind, it makes sense to review a few of the important considerations that a company must make when expanding their business. A carefully planned expansion or development will ensure the investment begins to demonstrate a significant ROI as quickly as possible. Get a head start on your evaluation by using the following tips:

1. Develop A Vision: There’s no point in committing to a business expansion unless it’s part of a comprehensive strategy. Making infrastructural changes just to shake things up is an extremely risky move. That’s why it’s always important to consider how an expansion plays into the company’s broader financial goals.

2. Do Your Homework: Once your entire company is aligned behind a single expansion strategy, it’s time to figure out all the dirty details. Identify costs, anticipate potential snags in the development schedule and mock up loan terms that sync up with your company’s timetable. In addition to making it easier to find the right lender to finance your project, this familiarity with the process will provide your company with added leverage during negotiations.

3. Establish The Backup Plan: Even if you’ve come up with a foolproof plan for your business development project, there’s still plenty of chances that your expansion won’t go as planned. That’s why it’s prudent to consider alternative revenue streams or means of consolidating assets as a backup plan in case the expansion is not as successful as expected.

4. Find A Lender: Once your company has taken plenty of time to plot out its development project, it’s time to talk to a commercial lending professional. Your research should have provided you with some direction as to the type of loan terms you’ll need with your financing. Strongly consider online lenders in addition to traditional financial institutions.

The Right Commercial Loan Provider Understands Your Project

When comparing different commercial loan providers, you’re likely to find a few who offer comparable terms for your project. Go with the lender with more experience funding projects similar to yours. You’ll find that working with a lender that understand and supports your project is much more productive experience.

Your choice in commercial lender and loan terms will determine how quickly your investment needs to start producing a meaningful ROI.

Want more flexibility with regard to your project financing? Work with a lender that has experience financing unique projects. You can learn more about the types a projects a lender has funded by viewing their online portfolio.

Dennis Dahlberg Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:     (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701

About the Author:  Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years. 

Technorati Tags: commercial loans,commercial lending.commercial mortgage

3 Major Mid-Year Takeaways From Commercial Lending in 2017

The commercial lending industry is changing rapidly. This means new opportunities for online lenders to work directly with companies embarking on ambitious development projects.

So far, 2017 has been a positive year for the commercial real estate industry and, naturally, commercial real estate lending. The successes of the year’s first two quarters is especially remarkable considering the unprecedented growth that occurred in 2016. Despite the fact that commercial real estate experts continue to predict the market is nearing its peak, the industry continues to chug along with moderate yet surprisingly consistent growth.

Every boom peaks out and comes to an end, however. There’s still a chance that the first half of 2017 represented the final gasps of a market headed over the hill. Regardless, taking a closer look at the major developments in commercial lending reveal that the industry is going through major changes. There’s no saying if commercial lending will continue to rise in 2017, but it is clear that the industry is headed in new directions either way.

1. Q2 was a boon for the entire industry: The first half of 2017, especially the second quarter, was a major success. Data collected by the Mortgage Bankers Association reflected a 20% increase in loan origination compared to 2016, according to Scotsman Guide. Increased commercial lending in industrial, office and multifamily sectors were the primary drivers of this surge.

2. Traditional lenders like banks are expanding their horizons: Anticipating an inevitable shift in the market cycle, many traditional lenders have begun to consider a wider range of projects and customers in new industries. According to the Grand Rapids Real Estate Journal, 2017 saw more traditional lenders take on greater numbers of small business, medical, assisted-living, agricultural and hotel clients. Many lenders have also expanded their financial services to include asset and land financing as well.

What does that mean for your business? Even more options for finding the best financing option for your company’s next big project.

3. Experts split on the future of lending growth - Few argue about how rosy the first half of 2017 has been for the commercial real estate industry, but there’s plenty of dissent about how the rest of 2017 is likely to go. According to a report from Bloomberg, banking professionals have reacted to the Federal Reserve’s latest data positively, interpreting signs of accelerated commercial and industrial lending around the corner. Others saw signs of trouble for the rest of 2017, noting that loan demand began to soften by the end of Q2 2017.

Take Advantage Of This Stable Commercial Lending Market Demand Before It’s Too Late

What’s the best way for companies to respond to these takeaways? Act decisively. The industry is always changing, so look to leverage any advantage you see in the status quo before it disappears. Hesitating now could lead you to making a wasted investment down the road.

You can move forward on your next big real estate or development strategy with a quick loan from a trusted online lender

The right loan under the right terms allows your company to create its own golden opportunities. Get in touch with an experienced online lender today to learn more about your company’s option for a commercial mortgage.

Dennis Dahlberg Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:     (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701

About the Author:  Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years. 

Technorati Tags: commercial loans,commercial lending.commercial mortgage

Don’t Miss Out On What Online Commercial Real Estate Loans Can Offer Your Business

Getting your commercial real estate loans online could give your business a critical advantage. Don’t assume that financing terms decided by a bank have your best interests at heart.

Just fifteen years ago, the idea that your business might finance its next real estate move over the Internet was laughable to most. A decade and a half and multiple economic crises later, the landscape has changed significantly. Businesses have become far more receptive to getting capital through online channels, creating a sustainable market for a new generation of online lenders to finance commercial real estate loans.

Today, online lenders are more than just a backup plan for those that can’t get financing from a bank or another traditional institution. They can provide invaluable assistance when your business is in need of a commercial mortgage, operating funds or another form of financial assistance. They also offer their own unique advantages over banks and other traditional lenders. Take time to familiarize yourself with these special perks of working with an online lender for financing help.

Emergency Access To Business Capital - One of the major advantages of working with an online lender is that they make things easy for businesses who need financing immediately. They impose far fewer qualifications on borrowers than banks and offer a streamlined loan application process. If your company needs to act on a real estate move right away or doesn’t want to deal with the added logistics of going through a traditional financial institution, online lenders represent a convenient alternative.

New Credit Lines For Start Ups - One hurdle that small business owners overlook until it becomes a serious problem is that their business has yet to establish a strong credit history. Start ups with existing capital can work with an online lender to take on a commercial loan that fits into the company’s long-term financial goals while also providing opportunities for the borrower to build up their credit score.

Options For Borrowers In Credit Recovery - It’s unfortunate but true that businesses that get into credit trouble pay for their mistakes more than once. One of the ways that these companies bear an extra burden is via a low credit score. A recovering credit score makes a company less attractive as borrowers to banks and limits their ability to bounce back by successfully expanding their business. Online lenders are much more enthusiastic about working with customers that don’t necessarily have the most sterling credit history. This is an important opportunity for companies strategizing to overcome bankruptcy and other types of credit problems.

Review Your Online Financing Options Before Committing To A Bank

Just because you qualify for a commercial real estate loan from a bank doesn’t mean that offer is the best financing option on the table. It always pays to compare your options online and see where your company can get the loan that best furthers long-term business goals.

Compare your project to funded deals on an online lender’s portfolio to get an idea of what financing would look like for your business
An experienced online commercial real estate lender will host an extensive portfolio on his or her website. This information is a great place to start your research if you are considering a development project for your business.

Dennis Dahlberg Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:     (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701

About the Author:  Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years. 

Technorati Tags: commercial loans,commercial lending.commercial mortgage

4 Reasons To Prefer A Private Lender For Your Commercial Mortgage

Need a flexible financing option for your commercial mortgage? Private lenders don’t impose the same stifling requirements as traditional financial institutions.

The reasons that a company may take out a commercial mortgage are fairly typical across the board, revolving around plans to acquire, develop or refinance a real estate asset. The terms and conditions necessary to make this loan feasible for both parties, however, will differ greatly between projects. In fact, there are many projects that may turn off traditional lenders like banks and development firms. In cases like these, your company has an opportunity to work with a private lender to help finance a big real estate move.

There are a long list of reasons that a trusted and experienced private lender is an ideal source of financing for a commercial real estate acquisition or development. Look over the following advantages and strongly consider how working with a flexible private lender could create new opportunities for your business.

1. Your Company’s Revenue Streams Aren’t Guaranteed - Maybe your company’s revenue streams are highly seasonal or your company is succeeding on a contract-by-contract basis. This may be working out for your company, but this business style makes it difficult for a traditional lender to make predictions about your long-term success. Banks prefer going with a sure thing. Thankfully, private lenders are more willing to work with borrowers to make a deal.

2. Traditional Lenders Are Unfamiliar With Your Niche - When traditional lenders are unfamiliar with an industry, they may have less confidence in a company’s ability to pay back a loan. As a result, the mortgage terms that a niche business are offered may be less generous or favorable than those offered to a known entity. Most private lenders are free of these preconceived notions, making them an ideal financing partner for niche business owners.

3. Business Credit Is Still Recovering - It’s not uncommon for companies to hit the occasional roadblock that leads to a dip in their credit score. A one-time mistake or error in judgement shouldn’t prevent your company from getting the funds it needs to do business. Even if your company’s credit score is not at its best, private lenders are more willing to qualify borrowers that can demonstrate a way to pay back the loan in the future.

4. You’re Looking To Sell Quickly - Does your business have an opportunity to invest and flip a commercial property within few months? What about few weeks? In cases like these, working with a traditional lender can be difficult. Private lenders, on the other hand, often specialize in reasonable, short-term loans. Finding financing this way is a much quicker way to go, which may be necessary to pull the trigger on a time-sensitive investment.

Private Lenders Can Help Streamline Your Commercial Mortgage Process

Need to get to work on your company’s next development project immediately? Working with a private lender to finance your commercial mortgage allows you to avoid many of the tedious hoops required by traditional lenders.

The right private lender will offer you flexible terms that put your business in an advantageous position.

Don’t let a great commercial real estate opportunity pass your company by, even if you’re recovering from credit issues or short on existing capital. Find the right private lender that can open up new doors for your company.

Dennis Dahlberg Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:     (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701

About the Author:  Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years. 

Technorati Tags: commercial loans,commercial lending.commercial mortgage