Bank loans are for companies and business owners with the highest credit rating. Also, typically a bank will require the company to prove they had a decent profit over the last 1 to 3 years. This time period can range anywhere from 5 to 20 years.
SBA COMMERCIAL REAL ES AL REAL ESTATE LOANS
The Small Business Association (SBA) has a few types of programs that you can get a real estate loan for. The 7(a) and 504 loan programs are the most common. The former is a general purpose loan that you can use for multiple reasons such as buying property or repairing it. These loans can be up to 25 years long for real estate and have interest rates in the 7% to 9% range. This type of loan is tailored to business owners who want to purchase commercial properties up to $5,000,000. The 504 loan is designed to help small businesses buy or renovate upper-class or pricier assets, such as land or even just equipment. An approved lender will work with a bank to get financing for the business or owner. These loans have long terms of up to 20 or 25 years and very low fixed rates that start around 5%.
COMMERCIAL BRIDGE LOANS
This loan is short-term, hence the name. It’s designed to let you capitalize on a quick chance to pounce on open real estate, and, usually, flip it. When the loan reaches the end of its term, you have to pay it off in full or refinance it to make it long-term. So you don’t need to be an investor or flipper for these. These are meant to bridge the gap between finding either long- term loans or property. Any type of lender can give these loans. Still, these are usually for investors. If you are with a broker, chances are they won’t recommend these.
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