It Is Wise to Get a Loan for Buying the Commercial Property Conveniently

You can easily get the funds for buying a house, but it is not the case with commercial property. Nowadays, raising funds for purchasing a commercial space is not a piece of cake. There lies a huge difference between funding a residential and commercial property, although the financial documents required for the eligibility for the loan are same.

Fees: The major difference is that of fees. The processing fee for the residential property is standard or even lesser sometimes. However, for commercial property, it is standard 1% of the loan amount.

Technical evaluation: While going for a loan for commercial property, the builder needs to have all the technical specifications whether it is the shaft, escalator, fire extinguisher or double staircase. An authorized technical evaluation team will be there to verify every detail. Unlike residential property, it has more aspects to inspect.

Loan tenure: The loan tenure offered in a residential property can be as high as 30 years but with the commercial property, it is restricted to 10 years.

High rate of interest: Rate of interest is a great factor while getting a loan for commercial property. Usually, it is 1-2% higher than the residential property. If the lenders did not find your documents much stronger, ROI can increase to 4-5%.

Although the loan tenure is less with high rate of interest, the return on investment in the commercial property is always high.

If you want to qualify for a commercial loan, you need to meet the following requirements:

·         You must have a credit score of more than 680

·         Minimum cash down payment of 10%

·         Your business must be more than 3 years old

·         There should be no recent bankruptcies or any foreclosures

Thus, if you meet all the minimum credit requirements, owning a commercial property becomes convenient with a commercial property loan.