We’re big on small balance commercial real estate loans.
Small business owners and investors utilize small commercial properties nationwide to support and operate their businesses. We believe strongly in this type of asset and have developed financing solutions for commercial real estate loans designed specifically to help entrepreneurs achieve their vision of real estate ownership.
Whether you are a seasoned commercial mortgage broker or thinking about offering small balance commercial real estate loans for the first time, it’s important you understand how the type of property financed can affect the commercial loan terms.
From a lender’s perspective, commercial buildings with more general use capacity like retail, warehouse or office space are easier to finance than properties built for a specific purpose (i.e., bowling alley, bank or manufacturing plant) because they have an inherently lower risk due to a higher market demand from investors. Lenders often avoid financing specific use properties or require a lower LTV (e.g., higher down payment) on them to offset their higher risk profile.
At ZFG, we provide loans for a wide variety of commercial properties, including:
Automotive Repair Shops
While we do provide investment property financing for up to $5 million on small balance commercial real estate buildings, most of our commercial real estate loans fall under $2 million in value. These smaller loans are much easier to approve and close in comparison to “institutional” loans for larger properties, so they’re a great place to start if you’re a broker who hasn’t done commercial real estate loans in the past.
Starting with smaller, easier-to-approve buildings will help you establish your commercial mortgage lending practice. Once you’ve completed a few commercial loan deals, you can quickly move on to larger properties to generate more revenue per deal.