Commercial Loan Mortgage | 5 Things to Know About Commercial Loan Mortgage Brokers
Mortgage brokers are a commonly used tool in commercial lending. Heavily regulated, they are capable of finding loans from multiple lenders and analyzing all of the available options to find you financing that works for your needs.
While in the past some brokers tried to hustle their clients into paying more than necessary, now brokers are considered a valuable tool that is better able to do the work that helps you finance a commercial loan mortgage. Although brokers are not right for everyone, they are useful in finding better rates.
What to Know About Commercial Loan Mortgage Brokers
Understanding brokers, who they are, and what they do is a great way to make sure that you know what to expect going into working with one. The following are 5 things to know about commercial mortgage brokers:
- Interest Rates May Be Higher or Lower – Some brokers can find you the best interest rates available. Others find you good rates, but add a 1% APR fee in order to get more money from the bank. Obviously the former is preferable, but the latter may also still be a good option because generally those brokers charge few to no fees, saving you money now at only a small cost later.
- Commercial Construction is Often DOA – Many brokers will not work with commercial construction loans because they are difficult to fund. There are thousands of properties for sale, and most brokers would prefer to stick with the built ones.
- Will Drop Non-Serious Clients – Some brokers will work with you if you seem interested in a commercial loan mortgage, even if you’re not sure. But others will drop you quickly if they think you’re not serious. Most brokers handle 20 clients at once knowing that only 3 or 4 will complete the sale. They often will not spend time on unlikely leads.
- Prefer Small Loans to Large Loans – Even though larger loans mean more profit to the broker, a smaller loan is far more likely to close. Most brokers prefer to take on smaller commercial loans, so they can use their attention on a loan that has a better chance of becoming final.
- May Work With a Bank – Some mortgage brokers do work directly with a single lender. Ask them. Licensed brokers are required to tell you the truth. There is nothing wrong with a broker that has preferences, but if you want them to shop around make sure you ask them if they have those connections.
Obtaining a commercial loan mortgage is more likely to be possible with a mortgage broker, simply because they have the tools and expertise to move everything forward. While they may not be the best option for everyone, compared to retail many people find that brokers have better connections and better rates, as well as fewer fees in the process.
At CRE Lender, we have analyzed countless brokers and loans and can point you in the direction of those that will close on your project quickly. Find out more about CRE Lender and what we offer by signing up for our services today.
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