Specialized Business Loan And Commercial Mortgage Situations
By Steve
Two of the most specialized business financing and commercial real estate situations involve golf course financing and funeral home financing. These two complex business scenarios will be used to illustrate viable commercial mortgage strategies.
Funeral home loans and golf course loans involve difficulties not found in common business situations. A commercial to buy a business for a golf course or funeral home is among the most difficult business financing scenarios, and refinancing will probably be more difficult than the initial commercial mortgage purchase for buying the business.
Fewer Business Lenders - Funeral Home and Golf Course Financing
There has been a significant reduction in local and regional banks offering business programs for funeral home financing and golf course financing. This of course compounds the already difficult commercial environment for funeral homes and golf courses due to fewer commercial lenders which are willing to provide reasonable commercial mortgage terms.
Buy a Business - Business Opportunity Financing
Business financing to buy a business opportunity is a special business variation in which commercial property is not purchased. The land and buildings in such a situation are typically leased for ten years or more. Similar to
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Business Terms to Avoid - Funeral Home and Golf Course Loans
It is critical to avoid undesirable business terms when refinancing or buying a funeral home or golf course business. Particularly important terms involve the percentage of value for the commercial mortgage and the length of the commercial loan. Regional and local banks will frequently offer short-term business financing instead of a longer-term commercial loan.
Stated Income Commercial Mortgage Difficulties
Although a stated income commercial has a certain number of benefits in specific circumstances, the use of stated income business financing is not recommended for a funeral home or golf course loan. A major limitation of a stated income commercial mortgage is the maximum business possible. A further limitation is the low percentage of value for stated income commercial financing involving either golf course financing or funeral home financing.
Business Value and Commercial Real Estate Value for a Business Loan
For golf course loans and funeral home loans, the commercial real estate value is often less than the business value. This is particularly true with a funeral home appraisal. The problem with this disparity is that many business lenders will provide a business that includes only the commercial mortgage value, and this will produce significantly reduced business financing.
Funeral Home and Golf Course Financing - Avoid Excessive Business Fees
Commercial borrowers should expect some legitimate and reasonable commercial mortgage fees during the initial commercial process. There are several commercial lenders that continue to take advantage of the severe lack of business choices for purchasing, building and refinancing a golf course or funeral home. One of the particularly unacceptable tactics is to charge exorbitant fees ($25,000 is not unusual) whether or not the business financing is successfully completed.
Commercial Lender Options for Funeral Home Loans and Golf Course Loans
As mentioned earlier, the supply of acceptable business lenders for this kind of business financing has been reduced. An agreeable commercial mortgage for a golf course or a funeral home will depend upon a wise lender choice.
A business borrower must be ready for the restricted number of qualified lenders for a golf course and funeral home commercial to buy a business. It is essential to find a lender with the resources to complete the complicated commercial mortgage process in a timely manner and concurrently avoid the business difficulties previously described.
Additional Business Finance and Commercial Mortgage Considerations
Even though the potential business problems described in this article are substantial, there are additional commercial mortgage difficulties which should be anticipated and avoided. Borrowers should plan to have early and extensive discussions with a business financing expert before proceeding with either purchase or refinancing efforts involving specialized real estate investment property such as golf courses or funeral homes.
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