*Commercial properties have a potential to give good returns; therefore, a
lot of investors prefer commercial investments. Shopping malls,
multiplexes, IT spaces and branded retail outlets are among the most
popular commercial properties in India. With the mention of acquisition of
a property comes about a requirement of a loan. This article talks about a
few facts surrounding commercial real estate loan.*
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*Qualification for commercial real estate loan: The sanction for a
commercial real estate loan is a tedious and more complicated procedure as
compared to a home loan sanction. Almost all banks ask for several years of
tax returns in order to give a go ahead for a commercial real estate loan.
Moreover, loans for commercial properties such as eating joints or
restaurants are more challenging than loans for office spaces or retail
buildings.*
*Higher rate of interest: The commercial real estate loan has higher rate
of interest as compared to the rate of a home loan; therefore, anyone
applying for the loan should before hand calculate the re-payment capacity.*
*Vast documentation: The document scanning during a commercial real estate
loan is vast and almost tedious. Every legal document of the organization
starting from income statements to profit and loss statements, balance
sheets to statements of cash flow are required. Other than the documents
relating to the business, there is also a requirement of the personal legal
documents to evaluate the background.*
*Loan sanction: As there are numerous phases involved in commercial real
estate loan, the sanction of it from bank takes several weeks. Therefore,
make sure that you are really transparent and organized in your approach to
avail a commercial real estate loan.*
*The more knowledge you acquire about commercial loans, the better decision
you can make about the commercial real estate investment and the process
would also be easier and speedy.*
*Source : Makaan Researach Team*
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