Want to apply commercial mortgage in British Columbia? Looking for a trustworthy mortgage broker in Abbotsford, Surrey, and Edmonton? There are many brokers who are ready to provide you a commercial mortgage at a promising rate, but only few of them offers flexible terms and conditions. Choosing the best one for you is both important and critical. Some brokers only approve mortgages when there is ample of collateral or asset security available, whereas others prefer to lend to owner-operators or only support land developments.
Financial Checks & Requirements
When you apply a commercial mortgage in Abbotsford, you are subject to meet the following requirements and financial checks:
- 3 years of accounting or tax returns
- Current and predicted performance figures
- Bank Statements
- Details and profiles of all directors and partners in the business
- Asset and liability statements
Not only this, here are some other requirements you need to understand before applying a commercial mortgage in Edmonton, Surrey, and Abbotsford:
- Mortgage Term: The loan period might also vary substantially, ranging from 5 to 40 years. It’s a significant financial commitment, so you should understand both what you want from your business mortgage and what your mortgage lender expects from you.
- Repayment: Interest rates are often higher than for residential mortgages because the financing is perceived to be riskier. You will most likely be required to make a larger deposit of at least 30%, which translates to a lower loan-to-value (LTV) rate with the benefit of increased equity.
- Credit History: Your credit history will have a significant impact on whether your commercial mortgage application is approved. However, the single focus is not always taken into account; you must also present a comprehensive image of your organization, including estimates and a business plan.
- Property Usage: Not all commercial mortgages are the same; what and how you utilize your property can influence both the amount you can borrow and the interest rate you receive. If you purchased an office building for your business and then decided to renovate and sublet some of the space, your commercial mortgage would have changed from an owner-occupied to an investment enterprise. In many circumstances, this will result in a decrease in your lifetime value.
- Stamp Duty: A land tax is charged on all properties, and the rate fluctuates. It is important to stay aware of the current stamp duty value charged by the government.
- Interest Rates: Variable rates are set by the Bank of Canada and will change based on the rate set at the moment. Fixed rates can be established for a specific time period often up to 5 years, providing guaranteed repayments that are set for the entire mortgage period.
- Fees: Just like commercial mortgages in Canada, you can expect to pay a conveyancing cost, an arrangement fee, a valuation fee, and an administration fee.
- Renting: A popular and feasible solution for business owners to maximize the earning potential of their properties while offsetting the expense of their repayments.
- Refurbishment: Always consider the expense of any renovations, installations, decorating, or general refurbishing work that your new property may require.
- Tax: The interest payments on your commercial mortgage are tax deductible.
File A Commercial Mortgage With Sandhu & Sran Mortgages
Whether you are buying your first commercial property or just expanding your business, Sandhu & Sran Mortgages is here to help you out. With a team of experienced brokers, we can get you approved in no time and at the lowest rate possible. Let our team assist you with a smooth transition into your new commercial property. For more details, give us a call today.