Commercial Loans: The Next Phase of Your Investing Strategy

Dated: December 23 2023

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If you follow anything I've posted or worked on the last year or so, you are fully aware that I believe investment properties are the best way to build wealth. To keep your investment portfolio strong and growing, you have to be on the lookout for opportunities as they come your way. A commercial loan might be that opportunity! Commercial loans offer a wide array of advantages over traditional mortgages and should be a tool in your investment belt. Here are just a few of the advantages you might see when using a commercial loan for your next investment property.

More Flexibility

Commercial loans offer greater flexibility on the condition and type of property you buy. While traditional mortgages have restrictions on type, size, condition, and location, commercial loans are not constrained by any of that. Whether you are looking to buy an office building, retail space, or single-family home, a commercial loan can do it all!

Higher Loan Amounts

Money laying out, loan approval cash

Commercial loans typically come with a higher loan amount than a traditional mortgage. This means you can take on larger projects and acquire properties with a higher value than you might otherwise be able to do. The higher loan amount means you can pursue opportunities that would be out of reach using traditional mortgages.

Custom Repayment Structures

Commercial loans offer investors the chance to customize their repayment schedule. This allows you to cater your payments to align with your cash flow or project timeline. Such items may be an interest-only period or moving the timing of the balloon payment. The point is that as the investor, you can work with your lender to come up with the best plan that benefits both you and them.

Man giving thumbs up of approval

Fast Approval and Closing

Commercial loans typically have a much faster approval and closing process than a traditional mortgage. The less stringent regulations and streamlined processes mean you can move quickly on a property you like. In a competitive market, this could be the factor that wins you the deal!

Conclusion

In the world of real estate investing, the choice between a commercial loan and a traditional mortgage can have a major impact on the success of your investment. The flexibility, higher loan amounts, custom repayment schedules, and fast approval process make them an attractive option to many investors. For further reading, Investopedia has a great, in-depth article you should check out!

As with any financial decision, you must discuss your options with a qualified expert. Almost every bank will have commercial loan officers who would be more than happy to sit with you and discuss your situation and see if a commercial loan is the right choice. Of course, you can always contact me with any of your questions and I’d be glad to help however we can! Happy investing!

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Billy Daniel

After investing in real estate for several years, I decided to get my real estate license so that I could more directly help others navigate the exciting, and sometimes frustrating, world of real esta....

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