Small Commercial Mortgage

A very good source of financing for business owners that own property but can’t qualify for other kinds of loan is a small commercial mortgage.

A business owner might be able to get a small commercial mortgage because it is a secured loan. All a business will need to get a small commercial loan is real estate or property that they have equity in. If the value of a piece of property exceeds the amount it is mortgaged for, the owner has equity in that property.

Even business owners with bad credit ratings might be able to get small commercial ratings very quickly. Small commercial mortgages can be an excellent source of financing for speculative businesses and new businesses as well.

Getting a Small Commercial Mortgage

A big advantage to a small commercial mortgage is that it is one of the fastest kinds of business financing you can get. A business owner with equity in property should be able to get a small commercial mortgage from online lenders in just a few minutes.

Some online commercial mortgage lenders might be willing to forgo credit checks if a business can verify that it has cash flow. These lenders will probably charge much higher interest rates and apply much stricter terms to a small commercial mortgage.

The best place to find a small commercial mortgage is online. There are many lenders that issue these mortgages and most of them operate online. The online application is quick and fairly easy for businesses.

Kinds of Small Commercial Mortgages

Small commercial mortgages are also called equity loans or private loans because they are based on equity. Since mortgages are equity loans equity lenders will be willing to ignore bad credit rates.

Private equity lenders may also be willing to loan money based on other assets such as inventory and equipment. There are even some private equity lenders who will loan money on accounts receivable.

A business will probably have to prove that it has the cash flow to pay off such loans. This can be done by providing receipts and bank records.

Drawbacks to Small Commercial Mortgages

There are some serious drawbacks to getting a small commercial mortgage that business owners should be aware. The biggest is that it will decrease your future cash flow because you’ll have another payment to make each month.

Another drawback is that it could reduce your ability to borrow in the future since you will have less equity available. Increasing the debt load on your property could also damage your credit rating and your ability to borrow money.

A business owner should always carefully consider the decision to take out a small commercial mortgage.