What Business Owners Need to Know About Commercial Loans in Boston, MA

Whether they’re looking to expand to a new location or renovate a current space, business owners need to find financial solutions that will work for them. That’s where commercial real estate loans come in. Read on to find out about Commercial Loans in Boston MA and how they work.

The Basics

Commercial real estate loans can be used to finance real estate purchases, construction, and development. They’re only available to business entities, such as limited liability companies and s-corporations. What that means is that the lender is offering to finance a business venture, not provide a personal loan.

How They Work

Commercial Loans in Boston MA are essential mortgage loans for businesses. They are secured by liens, which serve as guarantees of repayment. Be prepared to make a down payment of between 20 and 30 percent of the property’s purchase price, and expect to have a lien placed on the property, as this will offer some protection to the lender.

What Lenders Look For

Lenders typically have three sets of requirements when granting commercial loans. They’ll want to learn about the business’s finances, the business owner’s personal finances, and the property’s characteristics before offering a loan. Business owners should prepare their paperwork in advance to ensure the application process goes smoothly.

How to Prepare

Loan applicants will need to supply two years of personal and business federal tax returns to their loan officers along with their applications. They also must provide a personal financial statement along with certain other documents. These additional documents might include photos of the property, copies of leases, borrowing entity documents, and current rent rolls for business owners who plan to purchase existing commercial properties as well as construction schedules, budgets, designs, approvals, and permits for new construction.

The Bottom Line

Few small businesses have the capital to purchase properties outright, but those that are in good shape financially and show promise for future growth should have no problem finding a lender who can help. Visit the site to learn about one financial services company that works with business owners of all size to secure loans for purchasing existing buildings, funding renovations, or constructing new buildings.

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