Commercial Services
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RESIDENTIAL INFORMATION
What is a commercial mortgage
A commercial mortgage is a mortgage loan for commercial clients looking to purchase or refinance commercial properties, like a shopping centre or office building, purchase land to develop or build on, obtain a construction mortgage to build a single family home or multifamily development to sell, or for investors looking to expand their investment property portfolio. In the commercial mortgage market, it can be difficult to find commercial mortgage products that are best suited for your needs which is why a commercial mortgage broker is valuable to ensure you get the best rate and terms for your loan.
How to get approved for a commercial mortgage
It may seem overwhelming to think about the process to obtain a commercial mortgage depending on your commercial financing needs but a mortgage broker works with you to make the approval process as quick and painless as possible. For most commercial mortgage requests, we start by gathering the following information:
Personal information of all the business partners, other mortgages, other debts, and the business.
The details and supporting documents for the commercial building, office building, land, or project you are looking to obtain commercial financing for.
With the information and supporting documents up front, we can fully understand what your needs and goals are. We know what commercial mortgage lenders are looking for in order to provide an approval, so we'll advocate for your mortgage application to not only attain an approval in a timely manner but also negotiate on your behalf to get the best rates and mortgage terms.
How we can help
We have a commercial mortgages team of mortgage agents who can help with any business lending needs. If you are a commercial property owner already, you may have a great relationship with your bank, but how do you know that what they are offering is the best option available to you? Maybe we can find you lower interest rates or better terms. One of the key differences working with us is that we work with all banks and credit unions as well as alternative lenders to make sure the options you have is the most competitive in the market.
Recent Projects
SOME RECENT PROJECTS WE HAVE HELPED OUR CLIENTS FINANCE ARE:
Purchase of a commercial strata property for our client to operate their business out of as well as to lease out the extra units to generate an income stream
Completed development and construction financing over 5 phases with financing up to 80% loan to value for a 66 unit town home complex.
Purchase of a commercial retail space in Vancouver for our client to run their business out of
CMHC multifamily mortgage on a 54 Unit apartment building with financing up to 85% loan to value
Development and construction of 2 54 unit apartment towers
Purchase of a 20 acre agricultural property
COMMERCIAL FINANCING OPTIONS
This mortgage has a fixed interest rate that is set for a term, usually 1-5 years. Your rate and overall monthly payments stay the same throughout the term and if you pay the mortgage out before your term is up there is a penalty. Similar to a residential mortgage, once your term is up, you can pay it out or renew.
Fixed rate term mortgage
Land mortgage
Borrowing money from a lender for the purpose to either purchase or refinance a parcel of land set for development or construction.
Revolving line of credit
This is a variable rate mortgage which means the rate and monthly payments will fluctuate with changes to prime rate. With this mortgage, you can pay it out without a penalty at any time. The term length is usually 5 years.
This type of product provides the most payment options and flexibility as you can withdraw more money and pay back any amount without having to reapply each time. The interest paid is determined by a variable rate that fluctuates with prime rate and you are required to make interest only payments on the amount borrowed. Most banks require full repayment to a zero balance at least once per year as it is meant to be revolving.
Demand loan mortgage
Development mortgage
A mortgage to cover the costs involved with developing a property ie: servicing, city permits and other approvals.
Construction mortgage
This product facilitates financing the cost of construction for a project.
CMHC Multi family mortgage
CMHC has multiple solutions and initiatives to support financing on multifamily residential properties. These projects can be financed up to 95% loan to value and amortized up to 50 years. This keeps your payments low and extra cash available to you so you can continue your expansion into the real estate investment market.
We will find you a lending solution
FAQs
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Generally speaking, commercial lending requires a 25% down payment. There are scenarios where this can be lower depending on the request. We can also explore available equity in other properties to help with your down payment.
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Commercial mortgages work very similar to residential mortgages with the lenders taking the commercial property as security allowing you to borrow against the value of the property. The money borrowed is then repaid over an agreed upon time at an agreed upon rate. The biggest difference is that commercial mortgages are generally amortized over a shorter period with the exception of CMHC insured commercial mortgages.
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Short answer is yes. Because of the increased risk to banks, they generally do not have mortgage insurance to cover defaults, and complexities of the commercial mortgage transaction, variable and fixed interest rates are usually higher than residential rates and unlike residential lenders, commercial lenders do not pay brokers to bring the mortgages to them, therefore a broker fee will be involved. We take pride in making sure we add value and find ways to help our clients save money to cover this cost.
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In most cases you will meet the lender to open an account upon approval. We will also make sure you have a contact at the institution that holds your mortgage.
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If we have tried all of our options without an approval, we can arrange financing through private commercial mortgages. When providing private lending as an option, we protect our clients with also presenting an exit strategy so they can move out of this space and into another option in the future since private mortgages usually offer higher fixed and variable rates compared to other lenders.
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A mortgage agent through Allegro Mortgages will provide valuable consulting services for you and your commercial needs. Whether it is arranging financing for a new mortgage through non institutional and institutional lenders, or securing financing through private channels, they understand what is required to complete a commercial deal in a timely and effective manner.
