Monday, March 24, 2014

Are there any loans to purchase commercial land?

Are there any loans to purchase commercial land?
Commercial lands are not usually purchased, they are taken on Lease or rent for a fixer or a particular period of time and then lease is extended according to the contract.
Loans are provided for commercial establishment/- commercial loans,mortguage loans but the property will be mortguaged on the banks name.

(Additional answer) From previous answer, that is one way to do it, however you may receive a loan from a bank or even the SBA (Small Business Administration) for obtaining commercial property. SBA loans require less down payment (typically 10%). Also, if going through a bank, banks will usually not only take the property as collateral, but will ask for something else from either borrower or guarantor). We also will need proof the monthly payments can be made through an existing stream of income from another source from the borrower or guarantor. If you can show you have a primary source of income able to pay for the new loan along with the existing debt you have, and have a business plan or projections of what you will be doing to that space within 12-24 months, then a bank will look at such a loan. However, if you have no additional collateral, no other source of income to service the debt, and do not have a down payment (at least 30% typically for a bank on raw land), then you will most likely not be able to finance a commercial property (raw land).

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