Points to Consider When Applying for Commercial Mortgage Loans

You can apply for commercial mortgage if you wish to buy business premises or release capital locked in the commercial property. Be it an office building, apartment complex, shopping center or an industrial warehouse, commercial mortgage can be used for refinancing, acquiring or re-developing commercial properties.

Here are some of the key points to consider when applying for a commercial mortgage loan:

·         With this type of loan, you can expect a slight increase in monthly repayments if you have a variable rate deal. However, there won’t be any unexpected increases in rent

·         Your business capital will increase if value of the property goes up

·         Commercial mortgage is available at a higher rate of interest because this type of loan is considered risky

·         To help meet monthly repayments, you can rent a portion of the premises to another company but your lender needs to agree for such an arrangement

·         Compared to other types of loans, there can be some additional cost associated with commercial mortgage therefore, make sure you are aware of all details before applying

Whether you need commercial mortgage or a housing loan in Mumbai, make sure you do some research to find a reputed and reliable lender. There are several mortgage providers in the market but not all can be trusted. You need to find one that not only offers you the loan amount at low interest rates but also keeps the documentation requirements easy.

Since mortgage lenders require a deposit of approximately 25-40% of the property’s total value, make sure you are dealing with the right party. Different lenders prefer different assets. While some prefer first charge others prefer taking second charge against property. So, make sure all points are clear before applying.