In today’s post, we give you all the information you need about real estate loans, from a basic definition to the options you have when it comes to purchasing commercial real estate.
What Is a Commercial Real Estate Loan?
As you may have guessed by the name itself, commercial real estate loans are loans geared toward purchasing commercial real estate.
The term “commercial real estate” (or CRE, for short) refers to any property used exclusively for commercial purposes. This includes:
- Retail stores
- Office buildings
- Hotels
- Garages
- Malls
- Industrial property
- Among others
Just like residential loans help the average person purchase a home, commercial real estate loans help businesses purchase the properties or land they need.
However, while the analogy is useful to understand the basic principles of commercial real estate loans, there are some key differences between this type of loan and residential loans.
The most basic distinction is that commercial real estate loans cater to companies, while residential loans are designed with individuals in mind.
Furthermore, the repayment terms for commercial loans typically range between five to 20 years. Residential loans, on the other hand, can be as long as 30 years.
Your Commercial Real Estate Loan Options
Companies looking to purchase commercial real estate have different options at their disposal. Here are some of your alternatives.
SBA 7(a) Loans
This versatile lending program can be used for a variety of purposes and is the best alternative when you purchase a business and the operation includes real estate along with other assets.
To learn more about 7(a) loans, visit this link.
SBA 504 Loans
504 loans are focused on major fixed assets, so they are a great option to purchase existing buildings, land, or new facilities. They can also be used to modernize new facilities.
To learn more about 504 loans, visit this link.
Bridge Loans
A bridge loan is a form of short-term financing that helps you secure funds while you find a more long-term solution (this is useful if, for example, to finance a real estate purchase or renovation).
To learn more about bridge loans, visit this link.
Conventional Loans
This is what most people imagine when they think of commercial real estate loans. Simply put, this type of loan mortgage you get through a bank or other similar institution to purchase commercial real estate.
To learn more about conventional loans, visit this link.
Gellyfish Commercial: Facilitating Commercial Cash Flow
If you need financing in California, or anywhere in the United States, Gellyfish Commercial can help.
Contact us today by email (info@gellyfishcommercial.com), telephone (877-800-4493), or social media (Facebook, Twitter, LinkedIn), to schedule a free consultation or to learn more about our financing solutions.
