Below I have mentioned few terms to become familiar with to help increase your knowledge and help you become prepared and learn what to expect as you approach a Mortgage Refinance for a commercial property.
Two of the main reasons people look at Mortgage Refinance, is to help reduce monthly payments and interest, in my opinion one of the most important items to look at is how closing costs will affect the equity you have built over the years.
The initial thought process you had used before will be slightly different from the one used to prepare for a Mortgage Refinance. You had to think about the time it will take to secure a loan this size. It is possible for the amount of time specified on the contract to purchase could expire before you get funded, protection from default on such a large loan, not to mention collateral, down payment, closing costs and so on, not too unlike a mortgage on a house. Although, some of these items are the same, it can become very complicated on a loan this size for a commercial property as you get further along.
If you think back to when you applied for your original Commercial Mortgage Finance, you will remember thinking with a slightly different approach than you would with Mortgage Refinance. You had to think about the price of the commercial property, the time it will take to secure a loan this size, it is possible for the amount of time specified on the contract to run out before you get funded, protection from default on such a large loan, not to mention collateral, closing costs and so on. Things can become very complicated on a loan this size for a commercial property.
Before we move on to Loan Refinance terms let's recap what terms you had to learn before, such as 1031 Tax Exchange, Environmental Reports, what type of commercial property qualifies for what type of loan, which is a lot for one to learn, the difference between Conduit and Mezzanine Loans, and so on.
It is very important to find a good Broker that offers a variety of innovative loan programs for your specific need. So now, it is time to look at Loan Refinance. Things can become very difficult on a loan for a commercial property.
The terminology is somewhat different when it comes to Mortgage Refinance. You start looking at possible Prepayment Penalties, Cash out Proceeds, and maybe you want to inject the money you cash out into new business venture or update your current property, what is the Discounted Cash Flow, Current vs. Proposed Loan to Value Ratio.
Remember, knowledge is power, stay informed by reading and researching your topic. Be very clear about your reasons for Mortgage Refinance so you won't make mistakes that could cost you more in the long run.
About the Author:
This article is brought to you by the experts at EFD Commercial Investments Inc. For more free information about loan refinance
, visit their Mortgage Refinance
page.
