Why You Should Seek a Private Lender For Your Commercial Mortgage Loan

If you’re looking for a more commercial mortgage loan with more flexibility, a private lender may be the choice for you. Private lenders often don’t have as many expectations, regulations or difficult requirements to meet as bank lenders or other traditional financial institutions.

A private lender can be a solid and trustworthy source of financing for your business’s growth, whether you are purchasing a building, or expanding. Private lenders can even help increase new business opportunities for your company. If your company’s revenue streams ebb and flow largely or is dependent on individual contract bases, banks or lenders may see your loan as high-risk and be apt to reject your application. Private lenders are more likely to negotiate a deal with this type of business environment despite the seemingly unstable nature of cash flow.

Traditional banks tend to shy away from a gamble. If your company is considered to be “out of the box,” caters to a very specific market, or hedging a new industry all together, banks may not extend very generous mortgage terms, if they approve the loan at all. However, private lenders as not as rigid when it comes to “taking a chance” on a non-traditional business.

If you are establishing new business credit, or rebuilding bad credit due to an accidental ding to your credit score, banks are not very forgiving. However, if your business credit history is fairly clean save a minor mishap, private lenders are more apt than traditional financial institutions to negotiate a deal and offer financing in the way of short-term loans, which many private lenders actually specialize in.

Despite your company’s unique needs and positioning, private lenders are more apt too take on your commercial mortgage loan and offer flexible terms.

Without the hassle of jumping through the hoops of a traditional bank’s requirements, you can still get a loan for your business with a private lender. They can help you along in each step of the loan process and make it easy and hassle free.

The right private lender makes getting a commercial mortgage loan easy.

Do your research to find a private lender who is willing to work with you and negotiate a deal to put your business on the fast track to successful growth and development. Even if your credit score isn’t perfect or you have a business niche that traditional financial institutions might consider high-risk, that doesn’t mean you still aren’t eligible for a commercial mortgage loan with the help of a professional private lender. They are there when you need them to help guide you through the process and answer questions along the way.

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

Understanding the Repayment Terms of Your Commercial Mortgage Loan

Borrowing capital from a bank or lender requires repayment terms that can sometimes seem overwhelming. However, with a clear understanding and a plan, you can be prepared to meet the terms of your Arizona commercial mortgage loan.

Because these types of loans aren’t backed by Fannie Mae, or other government entities with residential real estate, many commercial lenders demand higher interest rates to off set the risk of loss. Credit, collateral and repayment ability is all taken into account on this type of loan very early on in the application review process. When it comes specifically to the loan repayment terms, it’s important to pay close attention.

A balloon repayment is often required with commercial mortgage loans via a traditional bank, that makes the terms of the repayment due earlier than the state due date. The balloon repayment refers to the fact that you will be required to pay interest and principal on the mortgage as documented for the first portion of the loan (which could be anywhere from 3 to 10 years). After that, the balance of the repayment terms it due in one lump sum.

The good news is, at the end of the initial repayment timeframe, the borrower can re-qualify or refinance your loan. More good news: while banks typically require this balloon payment procedure, alternative types of lenders are more willing to approve commercial mortgage loans without the stiff balloon repayment. Instead these loans may incur a higher interest rate but they allow the long-term repayment in the way of a fixed-term for around 30 years.

Is The Balloon Repayment Option Right For Me?

That depends on two factors: your business’s cash flow and your ability to save. If you have a solid business and are able to easily save money towards paying off this loan in one big final payment after a few years without stressing yourself out too much in the process, then go for it! After making that final payment, you’ll have the satisfaction of owning the building or property outright — what a feeling! However, if you feel the business or personal finances might be stretched to the max to meet the balloon payment, see if building in an option to refinance at that time is possible or opt for a more traditional repayment schedule with a non-bank lender.

Based on the terms of a bank loan’s balloon repayment, consider alternative lender options for a more traditional repayment structure.

Even though you may incur a slightly higher interest rate charge, going with a non-bend lender for your commercial mortgage loan may serve you better over the long run if you think you may struggle to repay the lump sum of the balloon repayment structure. Weigh your options and move ahead with what is best for you. In the long run, the slightly higher interest rate may save you the stress of a larger payment after a few short years into the loan.

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

Build Better Business Credit and Get Approved for Commercial Lending

One of the first things lenders and brokers look at when reviewing a loan application is credit score. Check out these simple ways to build and restore your credit to garner commercial lending eligibility.

In our personal and business lives, we sometimes can’t avoid the pitfalls that get us trapped into a bad credit score situation. Unfortunately, it can be one of the main reasons creditors reject an application for Arizona commercial lending. Nearly half of all small business loans get rejected due to low credit scores. Maintaining good business credit can also benefit you by helping you get lower interest rates on loans, better suppliers’ terms, additional lines of business credit and it could even help your business grow. Customers can search a company’s credit score and could very well base their choice to do business with you (or not) based on that number.

Aiming for a credit score of at least 680 is a good goal. The magic number is 700 (or higher!), but you don’t have to get fixated on that number at first. Start establishing credit with business vendors, and make sure you pay on time. Keep your public records free of credit “dings” such as bankruptcies, tax liens, judgments and debt collection. A long credit history is a good thing – but not when it’s riddled with ghosts of credit mistakes that can tarnish that history for years to come and diminish your chances for receiving Arizona commercial lending.

Ensure that your current FICO credit information is updated and as complete as possible with the three credit bureaus - Equifax, Experian and TransUnion. Even if you can’t get approved for a bank loan due to your credit score, resist the temptation to borrow from lenders that don’t report to the credit bureaus.

Getting rejected by a bank for bad credit doesn’t mean you should subject yourself to non-credible lenders that don't report to the bureaus to get commercial lending. There are other lending institutions besides banks that do report to the bureaus but may also have less strict lending policies when it comes to bad credit.

Charging your credit card can actually serve as a beneficial way to establish your business line of credit.

Using credit is a good way to establish a credit history, so don’t be afraid to utilize your lines of credit. However, there is a fine line between using them and going overboard. You don’t want to max out a credit card, so stay within 30 percent max of your credit limit.

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

It Ain’t Easy Being Green… But it Can Help Businesses Secure Commercial Loans

Eco-friendly building standards are important and beneficial for the earth and your bottom line. In some cases, it can even help you get approved for large and multiple SBA commercial loans.

The SBA 504 Loan was specifically designed for helping small businesses as they struggle to get a loan to take their growing businesses to the next level. According to the SBA.gov website, this loan program, also referred to as the Certified Development Company (CDC)/504 Program, is “a long term financing tool for economic development within a community. CDCs provide growing businesses with long-term, fixed-rate financing for major fixed assets, such as land, buildings and machinery and equipment.

In the case of green constriction, energy efficient buildings, green retrofitting and renovation, and renewable energy production for commercial purposes, the SBA Green 504 loan has a number of benefits for applications. It serves as a second mortgage that can be up to $5.5 million, with loans available on a “per project” basis. This allows for larger transactions in the $20 million range, because the standard SBA eligibility maximum of $5 million per borrower does not apply in the instance of the Green 504 program.

The Green 504 also does not include the job creation and retention requirements of a typical SBA 504, so smaller businesses with fewer employees now have a better opportunity to garner larger loans for businesses that have a lot of space, but not that many employees. This loan also offers financing for the acquisition, development or even refinancing of energy efficient buildings with tangible net worth and income requirements maximums increased to $15 million and $5 million for small and mid-sized businesses.

What are the Qualifications Small Businesses Owners Need to Get Approved for Green 504 Commercial Loans?

Business owners that are currently leasing or own a business can qualify by financing another building that consumes 10 percent less energy than the current owned or leased building. Another qualifying factor is if you purchase a building you’re currently leasing with the intent to make improvements to reduce energy usage by 10 percent. Examples of improvements include swapping out standard light bulbs for LED lighting, which can amount to up to 30 percent of a building’s energy consumption. A third option is if you currently lease or own, but want to construct a few building with 10 percent less energy usage, including LED lighting, better insulation or more efficient HVAC system.

Building or adding energy efficient strategies to an existing building are a win-win solution for any community, and there are even more benefits.

The Green 504 makes it easier for businesses that don’t have a government guarantee garner financing to purchase, build or even refinance numerous buildings with the maximum $5.5 million in SBA financing for each individual building project. That number refers to the SBA guaranteed second mortgage, and with no set limit on the first mortgage amount limit, larger projects are now very doable through the Green 504.

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

What Does a Commercial Mortgage Broker Do and How Can One Benefit You?

A Commercial Mortgage Arizona Broker bridges the gap between individuals and banks — helping to make a successful loan transaction process by serving as a liaison between the two parties. These professionals know the ins and outs of the process and can make dreams come true for those looking to get a loan.

Working in the real estate industry, a commercial mortgage Arizona broker works as a third party between financial institutions like banks and people seeking to get a mortgage loan on a commercial property. These experts general work with a number of financial institutions so they are able to offer their clients, who they sell loans to, more borrowing choices. This can benefit you because they can “pick and choose” from banks that may be better suited for the type of loan you are looking for or one that may be more lenient with their loan to value percent, for example.

But not all Arizona commercial mortgage brokers are created equal. These individuals are also required to have their license to operate in this profession; however, each state’s requirements for the licensing are different. Be wary of working with the first broker that seems over eager to work with you. Take your time and do your homework before choosing a broker to work with — you may even be able to find out if they have complaints against them.

The expert should be able to effectively review your eligibility, such as your repayment ability, credit score and history, and other important documents. Once they’ve helped you sort these criteria, the broker submits an application on your behalf to the lender he feels is best suited to your loan request. He will continue to serve as the “middle man” through the application approval process.

How Can You Be Sure Your Arizona Commercial Mortgage Broker Can Benefit Your Needs?

Getting to know a little bit about the individual before working with them will help you get a feel for whether they truly have your best interest at heart and understand your specific and unique needs. It’s important that you feel comfortable communicating with them and think they can properly communicate your needs to financial institutions.

Find a broker who you feel confident in, and one that proves they are best qualified to help you get the loan you need.

When looking to utilize their expertise, seek a professional that is dialed in to the way the loan market works. They should have savvy computer skills to stay up to date with their databases, know all the details associated with the various loan packages, and they should be able to offer you the advice you need to help you decide which product is right for your specific loan request.

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

How to Qualify for Commercial Loans

There are many requirements that must be met before qualifying for commercial loans. Learn what banks are looking for, and how you can increase your chances of eligibility.

In times of economic recession, banks and lenders can be a lot less lenient on the loans they will underwrite. If you’re not sure if you’ll qualify, there are three key expectations that underwriters will review before considering a loan: your credit, your repayment ability and your collateral.

First, a good credit score of at least 680 or higher is required. If you have a score of over 700, that is ideal. However, those without those high credit scores can still sometimes be approved. Next, the bank looks at the applicant’s capacity for repayment of the loan. Usually this means defining the cash flow of the property’s net income, which should exceed the mortgage payment by around 25 to 45 percent. Finally, collateral is expected; it is typical to expect a conventional commercial loan to fall between 50 and 70 percent loan to value.

Beyond these three components, the environment of the economy is important when it comes to qualifying. Some banks may be willing to accept a lower credit score or give a higher loan to value percentage. Some are likely to give a higher loan to value amount if the deal is very strong in the case of a property purchase or if you have lots of liquid assets. Sometimes, it is simply about timing.

If One Bank Rejects My Commercial Loan, Will I Qualify At Another?

There are thousands of banks across the country. Each has their own specific set of requirements to be met in terms of credit score, repayment capacity and collateral, and each has times in which it might have become too liquid, so it needs to loosen up its moneys. Casting a wide net to many banks is a good idea.

Before you apply for your commercial loan, make sure your credit, repayment capacity and collateral are in order to ensure the best chances of your loan being approved — but don't get discouraged if you don’t qualify right away.

Do your research on the banks and lenders before you approach them with your request so you know a little bit about what is expected. Be as prepared as possible with a solid business plan, reasonable need for your loan request, and preparation of items such as income tax returns, financial statements, bank statements, and legal documents like articles of incorporation. Banks have to protect their assets, so even if your ducks are all in a row, so to speak, that doesn’t guarantee loan approval. They may see your loan as too risky or consider the amount of debt you have to be too much. However, there are options such as Wall Street nonprime lenders and commercial mortgage companies that can offer subprime commercial loans.

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

When to pursue a Bridge Loan for Residential or Commercial Lending

Exactly what is a bridge loan and what is it best used for? Understand the basics of a bridge loan and when you should consider pursuing one for residential or commercial lending.

As its name suggests, a bridge loan is designed to “bridge the gap” from one asset to the next or until you secure an alternate source of financing for your project, business, real estate investment or home. In commercial lending, they are used to cover business expenses until expected capital becomes available. It is a short-term loan with a payback that usually ranges from 3 to 12 months, though some lenders offer longer repayment options. As an equity-based loan, it is backed by collateral such as real estate or inventory, and is usually considered when “quick cash” is needed.

Bridge loans can be the ideal solution when time is not your friend and immediate capital is required. The funds from a bridge loan are usually available in as short as a few days to as long as a few weeks, giving you the capital you need to move forward on your project or purchase. Many home buyers use this type of loan when they are purchasing a new home before their existing home sells. Today’s real estate market makes this avenue fairly safe and gives you the capital you need to continue making mortgage payments on your first residence or make a down payment on your new home. It avoids having to make an offer on a contingency to sell basis, which can often mean the difference in acceptance or rejection in a seller’s market.

Bridge loans are also useful for commercial lending when developers require funds for renovating a distressed property, when a small business needs quick funds to cover operating costs, or when capital is needed to fulfill seasonal orders. It can provide quick funds in order to start a build-out project or complete a quick buyout in order to gain controlling interest of a business. Many developers use this type of loan to begin work on projects while awaiting the approval process of a more traditional loan.

How to Obtain a Commercial Bridge Loan

While more traditional loans require good credit, the most important aspect of obtaining a bridge loan is collateral such as equity in real property. In order to assess the risk, a lender may also require a plan for repayment or exit strategy. On your part, perform due diligence by determining if there are prepayment penalties and what other costs are involved. In many instances, the need for immediate funds offsets any concerns regarding costs and penalties. It may also be possible to defer your first payment for a certain arranged period.

Always perform due diligence and obtain full disclosure

regarding your transaction costs, penalties and payment plan.

At Level 4 Funding, we are commercial lending experts who pride ourselves on providing the best possible service and believe in giving our customers all the information they need to help them make the best possible loan decision for their project, real estate investment, business or home. We offer bridge loans with rates from 7.99% for up to 3 to 24 months, interest only. Call us for a complimentary consultation.

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