Business owners are always looking for ways to improve and grow business operations – whether it’s renovating your current office space, refinancing debt, or purchasing commercial real estate. When looking to purchase real estate, business owners often ask funding from banks. However, qualifying for traditional bank loans is not a walk in the park.

Online lenders make a great alternative to traditional bank loans because they offer faster funding and lesser requirements. But the speed and convenience may cost you a bit more. As you look for the best commercial real estate loans, make sure to weigh your options before finalizing your decision.

Top 3 Commercial Real Estate Loans

To get you started, here are three types of business loans to purchase commercial real estate:

SBA 7(a) Loans

The 7(a) loan is the most popular among other SBA loans because of its flexibility, longer repayment terms, and flexibility of use. The Small Business Administration created the SBA loans and they guarantee up to 85% of every SBA loan, minimizing the risk of lenders. This incentive allows intermediaries to offer competitive loans to small business owners.

You can use the 7(a) loans for almost every business-related purpose, including the purchase of commercial real estate. However, you need to provide a 10% to 20% down payment and some lenders even ask you to provide collateral.

Commercial Bridge Loan

A bridge loan is a short-term loan used to purchase commercial real estate, which you can then refinance it to a long-term mortgage loan. Traditional banks and other lending institutions offer bridge loans to help business owners compete with all-cash property buyers.

Depending on your loan applications, you can borrow up to 80% to 90% of the commercial property’s loan-to-value (LTV) ratio. This means you need to provide the remaining 10% to 20% as a down payment for the property.

CDC/SBA 504 Loans

The CBDC/SBA 504 loan is another type of SBA loan created by the Small Business Administration (SBA). Similar to 7(a) loans, the SBA also guarantees a portion of every CDC/SBA 504 loan. But unlike 7(a) loans, you can only use this loan to buy equipment or real estate (land and existing buildings). This type of loan helps startup companies and small businesses to purchase or refinance commercial real estate. The CDC/SBA 504 loan is composed of two different loans and there is no maximum loan amount.

With the 504 loans, you can borrow up to 90% of the property’s purchase price. This means that you need to pay the remaining 10% of the property value. You can loan up to $5 million, which you can pay back within 10 to 20 years. It’s best to use the 504 loans to purchase real estate because it offers longer repayment terms and lowers interest rates compared to bridge loans.

To know more about small business loans, check out SMB Compass’website. We have a variety of loan programs to help you with every business need. Talk to a lending expert today! Give us a call at (888) 853-8922 or email us at info@smbcompass.com.

Fast Business Loans for Your Business

Long-term business loans have helped thousands of small businesses finance their growth and expansion. But there are times when businesses don’t need long-term loans. Instead, they need quick access to cash in order to fund time-sensitive expenses.

With SMB Compass’ fast business loans, you’re able to access your funds ASAP. Unlike traditional bank loans, you don’t have to wait for weeks or months! Our loan programs provide you with the working capital you need to address daily business expenses, such as taxes, vendor payments, rent, and more. Speak with a lending expert today to get a free quote – no strings attached!                       

How Your Business Can Benefit from Quick Funding

Fast business loans are great for businesses in need of short-term working capital for payroll, additional inventory, and other unexpected business expenses. Aside from that, here are some of the reasons why your business might need quick funding:

• Building Maintenance Issues

It’s common for businesses renting in commercial spaces to have plumbing, wiring, and other maintenance problems. The cost of installing a new roof, fixing electrical damage, and digging a sewer line to the street can really wreck your budget. Fast business loans provide you with the funds you need to quickly address unexpected expenses.

• Unexpected Business Opportunities

Business owners use fast business loans to take advantage of business opportunities. For instance, your supplier may offer discounts to customers who can pay upfront or buy in bulk. When opportunities like this come your way, you need to think and act fast. Don’t wait for months for traditional bank loans! SMB Compass’ quick business loans allow you to leverage on rare business opportunities.

• Repair or Purchase Equipment

Is your business dependent on specialized equipment to operate? If so, then you can’t afford damaged equipment. Whether you need to replace an oven or purchase additional printing machines for your print station business, fast business loans make sure you have the funds you need to repair damaged equipment or purchase new ones.

• Growing Pains

Growth and expansion opportunities don’t come often. So when an opportunity presents itself, most business owners welcome it with open arms. But they don’t realize that growth comes at a price.

Growth and expansion may mean hiring new employees, purchasing new equipment, training staff, adding inventory, or even moving to a bigger space. Depending on your business, these costs can add up. Business owners want to see their business grow. With quick funding, you can take advantage of growth opportunities and take your business to the next level.

Quick Business Loans from SMB Compass

SMB Compass knows the importance of securing immediate working capital for your business. That is why we’re committed to providing cost-effective and flexible solutions for your business. It’s our goal to make it easier for small business owners to secure fast business loans within days – not weeks. If you want to know more about your options, you can speak with a lending expert today.