Obtaining or even refinancing a commercial real estate mortgage can be a great way to get a loan with a favorable interest rate. Take a moment to see what’s available.

Mortgage Providers

There are many places you can look to find great options on a commercial real estate mortgage. Banks compete to give competitive rates and bring in loyal customers. Consider various banks before settling on who can provide you with the best deal and a solid working relationship. The SBA works with lenders to back loans for small businesses that meet their standards. This gives the borrower access to better rates and terms if they struggle to get a conventional loan. 

Some private lenders can offer unique loan solutions. They’re not bound by the same restrictions as a traditional lender, which opens up fresh possibilities. Do your due diligence to make sure the lender is a solid and trustworthy partner.

Now, look at some mortgage types:

Interest-Only

You will be able to pay only the interest for a while with this loan type. This keeps payments low at the start when cash might be tight, but you must be prepared to pay off the principal in full at the end of the loan. If you can count on a lot of money being available at that future date, this may be a reasonable solution.

Balloon Payment

Similar to an interest-only mortgage, you are left with a hefty bill at the end of the loan because the loan doesn’t fully amortize. You can put high costs at bay but should only take on this kind of loan if you’re sure of having the funds to pay it off at the end.

Adjustable-rate

With this loan, your rate will vary based upon an index. If you’re willing to ride the wave of the market, you’ll get low rates when times are generally challenging. At the same time, rates will rise when the market flourishes. If you’re savvy at adapting to market shifts, you may consider this loan type.

Fixed-rate

This is considered the tried and true mortgage that most folks take on. Your terms and loan length are set at the beginning of the loan. There are no surprises with a final balloon payment or changing rates. You can budget things out over time and may even be able to pay off the loan early with diligence and planning.

Keep an eye on the market and lenders to get an outstanding commercial real estate mortgage when the time is right.