Commercial Mortgage Loans & Specialized Commercial Real Estate Financing
Bridge Loans, Hard Money Loans, SBA Loans, Mezzanine Loans & More
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Shopping for a Commercial Loan?
If you're searching for commercial real estate financing, commercial mortgage refinancing or any other type of funding for commercial property such as a construction loan, bridge loan, SBA loan, hard money loan, mezzanine loan or structured financing, TCF has an amazing tool to help you find the best rates and terms from the hungriest and most motivated commercial & specialty lenders in the entire United States.
And while this powerful tool makes comparison shopping for the best rates and finding the right commercial lenders a snap, it makes applying for your commercial loan even easier;
with just ONE mouse click!
When you use our free mortgage lender databank, you'll have commercial lenders lining up to compete against each other to earn
your business.
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What Kind of Commercial Real Estate Loan Are You Looking For?
Acquisition & Development (A&D) Loans
A land development loan is secured by a mortgage and is used to finance the clearing, construction, fabrication and installation of all improvements required to convert raw land into construction-ready building sites.
Typical improvements might include subdividing, grading, leveling, building roads and bringing water, sewer, electric and gas utilities to the building site(s). These types of improvements are frequently referred to as horizontal improvements.
An acquisition and development loan (A&D loan) is a loan where a part of the proceeds are used to buy the property. The total project cost would include the cost of the land, the hard costs for the horizontal improvements, the soft costs (including an interest reserve and sales commissions) and a contingency reserve.
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Bridge Loans
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A bridge loan is a short-term commercial real estate loan designed to give a commercial property owner enough time to complete a specific task; tasks like improving the property, securing a new tenant or completing the sale of the property.
Typically, commercial bridge loans carry a term of between six months and one year, although it is not uncommon for many commercial bridge loan lenders to grant the owner the opportunity to extend the bridge loan for an additional six months to one year for an additional fee.
Commercial bridge loans usually get paid off when the owner secures permanent financing on the property after all improvements are finished and the tenants move into the property. Bridge loans are usually more expensive than permanent financing and, because they are short-term loans, most bridge loans have no prepayment penalty.
If a commercial borrower does not have strong credit and a large financial statement, he may need to go to a hard money bridge lender. Hard money bridge lenders are lenders who loan primarily on the value of the equity in the property.
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Commercial Real Estate Loans
Commercial real estate loans and commercial property loans are different from regular business working capital loans, business operations loans or lines of credit. There is a wide variety of commercial real estate loans available from short-term bridge or acquisition loans to long-term permanent financing. It just depends on the exact needs of the borrower, but in any case the financing is secured by a mortgage or deed of trust on a commercial property or business related property such as an office building or office complex, self storage facility, fitness club, a hotel or motel, shopping center, movie theater, strip mall, apartment building restaurant.
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Construction Loans
Commercial construction loans are loans issued to a company for the purpose of constructing a building or improving existing commercial real estate already owned by the company.
Construction loans are typically very large loans that are somewhat difficult to obtain if you go about it incorrectly. If you go to a bank for a commercial construction loan, your credit must be excellent and you must have a strong financial statement and a solid business plan or you will get declined. Alternative, easier to qualify for sources for construction loans can be found through our commercial mortgage lender databank. In just a couple of minutes, you can have an entire list of qualified funding sources.
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Hard Money Loans
Commercial hard money loans and hard money lenders are available in all 50 states. If you already own or have an opportunity to buy a commercial property almost anywhere in the United States with decent equity and either your financial position isn't the strongest or you have bad credit, you can still usually obtain a commercial loan from a hard money lender. Hard money lenders are all about the value of the property securing their loans.
Hard money lenders are in business to make the riskier commercial loans; the higher risk deals that the banks won't touch or would never even consider. Because of the higher risk and shorter terms involved, hard money loans are considerably more expensive than bank loans. Be that as it may, hard money loans still perform an important role. Hard money loans are often considered "opportunity loans" because they can be issued quickly to seize fleeting opportunities and then be replace with more permanent financing later on.
Hard money commercial lenders are interested primarily in the value of the property and the amount of equity in the property they are making the loan on as their recourse for repayment. In other words, if the borrower doesn't make good on his payments, the hard money lender will simply foreclose and sell the collateral to recover their investment.
Typical commercial hard money loans are short term loans. Six months to three year terms are common.
Something to be aware of when you're shopping for a commercial hard money loan is to watch for exit fees and prepayment penalties. An exit fee is a big fee that some hard money lenders charge when the loan is paid off, regardless of whether the loan is paid off early, on time, or late.
You should also watch for hefty late fees on the balloon payment. Better than 7 times out of 10, hard money loans end up getting paid off late. Many hard money lenders try to add on huge late charges on late balloon payments; sometimes as high as 10%.
Hard money lenders typically win business based on being able to close quickly. It is often possible to close a hard money loan in as little as ten days. This type of fast, short term financing is known as a bridge loan.
Commercial hard money lenders get their lendable funds from two different sources. One type syndicates a new group of private investors for each deal. The other type of hard money lender has big mortgage funds, similar to mutual funds, already assembled. As a result, these hard money lenders are usually faster.
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Mezzanine Loans
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Mezzanine loans on commercial real estate are becoming increasingly popular. One of the primary reasons is while residential foreclosures are at an all-time high and the economy is in turmoil, mezzanine lenders reported zero losses on mezzanine loans. As a result, mezzanine loan rates have fallen sharply this year as more mezzanine lenders have entered the market, thus making it a more attractive financing option.
Mezzanine loans are a form of commercial loan used to finance very large commercial properties - typically tall office towers, large hotels, industrial complexes, business parks and large shopping centers.
Mezzanine loans are large loans; usually at least $3 million and they are normally placed behind large first mortgages of at least $8 million. There are very few institutional mezzanine lenders who will consider mezzanine financing for under $3 million, although there are a handful of hard money lenders who will consider funding mezzanine loans as small as $1 million.
For simplicity, a mezzanine loan can be viewed as a form of second mortgage, although there are some important differences. In the capital structure, the first mortgage has priority, followed by the mezzanine loan, followed by owner’s equity in the property.
Mezzanine loans are different from mortgages in that the debt is secured not by a mortgage on the property, but rather by a security agreement against the owner’s stock in the company that owns the property. If the borrower doesn’t make his payments, the mezzanine lender will simply foreclose on the stock of the corporation or the membership interests of the LLC that owns the property.
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Permanent Financing | Refinance | Consolidate Multiple Loans
This is something of a catch-all category because permanent financing can be used to retire a construction or acquisition loan or a hard money loan, or you can refinance to take cash out or to take advantage of better rates or more favorable terms. You can also refinance to consolidate multiple loans into a single, larger, lower rate loan with the most favorable terms.
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SBA Loans
The SBA (Small Business Administration) offers a variety of loan programs to assist small businesses. It is important to note, however, that the SBA is primarily a guarantor of loans made by private lenders and other lending institutions and does not offer loans directly to small businesses.
Because SBA does not provide business loans directly to borrowers, you will need to find your preferred lenders in the databank to obtain an SBA loan. You will then work with your selected lender to submit your loan package to SBA.
Apply for an SBA Loan
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