Are you a commercial real estate investor? You’ve probably heard about a commercial mortgage broker from real estate agents. But what are commercial mortgage brokers, and why should you choose one over directly going to the lender?
This article expounds more on commercial real estate mortgage brokers. Read on below to know why you should use one when purchasing your investment property:
What Is a Mortgage Broker?
A commercial mortgage broker acts as a negotiator or a middleman between a potential lender and a real estate investor. It’s their work to compare different mortgage lenders and finds one with fair interest rates that suits your needs. Investment property loan interest rates are higher than in home loans.
Commercial mortgage brokers work with numerous lenders; thus, they have the network to make your lending process easier.
Commercial mortgage brokers are accredited, regulated, and licensed financial professionals. They gather relevant documents from you and verify your employment or income sources and use this info to help you apply for a loan.
Commercial mortgage brokers also negotiate loan terms on your behalf. This makes the process seamless and quick, saving you a lot of legwork.
Why Should I Work With a Commercial Mortgage Broker?
A commercial mortgage broker will hold your hand through the loan application process, making your work easier. They will also help you cruise through the intricate, jargon-filled mortgage world.
When looking to purchase an investment property, the mortgage application is just a fraction of the things you need to handle. When you are busy tackling other issues, a commercial mortgage broker will be at the forefront of looking for the right lender for you.
Below are 11 more reasons why you should work with a commercial mortgage broker instead of going directly to the lender:
1. They Have the Necessary Network
A commercial mortgage broker career involves working with lenders and real estate agents. This helps them create an extensive network of professionals in the industry. When working with a commercial mortgage broker, they look through their network to find you a lender with the best interest rates and loan terms.
A commercial mortgage broker will approach banks, and other lenders on your behalf, giving you various options. The more mortgage lenders competing to finance your investment property purchase, the higher your potential to save.
2. They Will Simplify Your Job and Work Out Your Borrowing Power
Your mortgage lender will calculate how much you can borrow from both banks and other non-bank mortgage lenders. The amount you can borrow varies depending on the different lenders’ loan terms and your borrowing capacity.
Whether you own a business or you’re employed, the commercial mortgage broker will help you work out your borrowing capacity. They do this in the quickest and most efficient way possible.
3. They Are Experts in Their Fields
Commercial mortgage brokers are specialists in their fields. Thus they provide you with much-needed guidance on different mortgage products. They will also help you analyze different interest rates and current market trends.
Commercial mortgage brokers are licensed and registered financial advisors. That’s because they facilitate property mortgages and other related products.
They advise individuals on different mortgage options. Thus, they know the best lenders based on your financial needs. They can also predict potential pitfalls and help you avoid them.
4. Commercial Mortgage Brokers Are Aware of Credit Policies
All lenders have different loan terms and credit policies. Your mortgage broker can translate mortgage jargon, helping you understand your lending options. Depending on what you’re looking for, a commercial mortgage broker has your best interest at heart and will help you get a loan with fair credit terms.
5. They Will Help You Find Investor-Friendly Lenders
Commercial mortgage brokers understand the best lending options to use for different types of investment properties. For instance, do you know what is a bridge loan? If you don’t, they’ll explain it to you.
They will shop around for lenders who finance your type of investment property.
Some lenders don’t understand the real estate investment landscape. That’s because they mainly deal with residential mortgage financing.
The commercial mortgage broker’s relationship with banks and other lenders can be beneficial to you, especially if you think your loan application might be rejected.
6. Commercial Mortgage Brokers Operate as Independent Entities
A commercial mortgage broker is unbiased and objective. They are not employed by specific mortgage companies; thus, they will offer you an impartial opinion about the best option for you. Their primary objective is to get you a commercial real estate loan that best suits your needs and financial circumstances.
7. They Save You the Stress and Time of Looking for Lenders
Shopping around and comparing different mortgage options can be very time-consuming and tiresome. Your commercial mortgage broker will simplify the process by helping you fill one application that they will send to all the lenders. Their job is to consult all lenders on your behalf to get you the best loan.
Instead of going back and forth with banks, the broker will handle this part of the work while you dedicate your time to other causes such as property hunting.
8. It’s Easy to Access a Mortgage Broker’s Services
Mortgage brokerage is considered a mobile service. Unlike other offices where you need an appointment, most mortgage brokers are always available and attend to clients every day of the week.
If you’re stressed and overwhelmed, your mortgage broker can even come to you. This kind of convenience is difficult to find when dealing with a lender directly.
9. Your Commercial Mortgage Broker Will Look at Your Lending Limits
The number of real estate investment loans you can carry at a time differs depending on lenders. Some lenders offer up to ten loans at once, while others offer only four. Working with the right commercial mortgage broker will help you create a long-term and short-term plan to ensure you’re fully utilizing your loan limit.
10. Your Commercial Mortgage Broker Will Provide Continuing Consultation and Support
After getting your mortgage approved, your commercial mortgage broker will also review your case once every year to make sure you are comfortable with your borrowing structure. This continued support also ensures that your mortgage repayments are still meeting your current needs.
The commercial mortgage broker will also negotiate with the lenders directly, especially if your fixed review is due. You don’t have to stay with the same lender for years, especially if they don’t meet your needs. Your financial service provider should meet your current borrowing needs.
11. Commercial mortgage brokers help you avoid the risk of dealing with one lender
Working with one lender means putting all your eggs in one basket. The approval process may also take a lot of time. If the loan is rejected, you’ll be forced to go through the same process with another lender, which can be quite frustrating.
A commercial mortgage broker will submit your application to numerous lenders, which increases your chances of approval. This also gives them more bargaining power, which ensures you get the best deal.
What Distinguishes Commercial Mortgage Brokers From Loan Officers?
A loan officer is an employee of a specific lender and is paid a salary and a lender’s bonus. The loan officer will only show the commercial real estate loans available from their employers.
On the other hand, commercial mortgage brokers are independent entities or individuals that work with different lenders to get their clients the best deals in the market. A commercial mortgage broker is not tied to one specific lender. That means they offer their clients dozens of options and a broad range of loan types.
How to Choose a Commercial Mortgage Broker
Are you looking to purchase commercial properties? Working with a reputable commercial real estate mortgage broker will help you secure the right real estate loan based on your needs. So how do you choose the right commercial mortgage broker?
The best place to start is inquiring from friends and family members. If you know anyone who has worked with a commercial real estate mortgage broker, ask for their recommendation. Learn everything about the commercial mortgage broker’s service, level of experience, approach to clients, and communication style.
You can also ask reputable real estate agents for referrals. They can give you the names of different commercial mortgage brokers they trust or have worked with in the past. If you’re working with a commercial real estate company, ask if their package also includes a commercial mortgage broker’s services.
Once you get the names of several commercial mortgage brokers, conduct interviews to determine their level of expertise, the services they offer, and how they handle their clients. Remember also to check their licenses on your specific state’s professional licensing board.
Contact Us Today for All Your Mortgage Financing Needs
Are you looking for a commercial mortgage broker near me? At Hasanov Capital, we offer all solutions for your financing needs. Our financing solutions are ideal for both real estate investors and small to medium-sized businesses. We can also finance B, C, and D credits and small businesses.
Contact us today, and a professional from our team will analyze your financial needs at no cost. Whether you’re looking for a business or commercial real estate loan, Hasanov Capital has got you covered.
