Navigating the World of Commercial Real Estate Loans

Securing a commercial real estate loan is your first step when seeking to purchase or renovate a new business property. When it comes to commercial real estate loans, there are a few options available to real estate investors, builders, and developers.

Navigating the World of Commercial Real Estate Loans

The traditional choice for borrowers is banks. However, with recent levels of uncertainty in the banking system, as well as the overall US economy, many small- to mid-size banks are beginning to require larger deposits from business borrowers in order for them to secure loans. This can be quite a challenge for many commercial real estate developers who prefer to put their money into real estate, not deposit accounts.

Additionally, with continued volatility in interest rates, many traditional banks are more reluctant than ever to lend for commercial real estate loans. Many remain quite hesitant loan for land purchases, construction, agriculture, multi-family construction, or commercial real estate in general.

Naturally, this puts builders, developers, and commercial real estate investors looking to finance their projects in a bind.

Most private lenders like Enact Partners are not averse to financing business-purpose loans in the current climate. For Enact Partners, business-purpose loans are the only kinds of loans they finance — and they do so with confidence, relying on the borrower and the merits of each unique project, not the market or the Federal Reserve, to inform their lending decisions.

Working with Enact Partners

Enact Partners stands out in the lending sphere by focusing solely on the needs of commercial real estate investors and businesses. We pride ourselves on being “Main Street” rather than “Wall Street,” underscoring our commitment to personalized service and tailored loan solutions.

Commercial Real Estate Expertise: With decades of collective experience in commercial real estate development and lending, Enact Partners has firsthand knowledge of the needs of real estate investors, developers, and builders. We know the importance of customized lending solutions tailored to borrower needs and timelines.

Streamlined Access: Compared to traditional banks, Enact Partners is typically able to provide streamlined access to capital. Most loans close within 7 to 45 days. Closing quickly on loans allows borrowers to respond to opportunities in a timely manner, which can be crucial to success.

Due Diligence: While the lending process may be streamlined compared to banks, private lenders still engage in thorough due diligence, including property inspections, appraisals, and marketplace analyses. Private lenders also consider the merits of projects, often relying heavily on borrower reputation and a project’s potential when deciding whether to approve a loan.

Ideal Borrowers & Projects: People who seek capital through Enact Partners are Commercial Real Estate Investors—namely entrepreneurs, builders, and developers—looking for financial backing for their real estate projects. As borrowers they must demonstrate the viability of their projects, financial stability, the property’s market value, and their ability to repay the loan to qualify for commercial real estate loans.

The Basics of Qualifying for a Commercial Real Estate Loan

The following fundamental requirements often play pivotal roles in loan approval:

Financial Viability and Creditworthiness: Borrower financial history, creditworthiness, and overall financial health are used to gauge their ability to repay a loan and complete the associated project. A solid financial track record often plays a pivotal role in loan approval.

Property Evaluation: The property intended for purchase or development becomes a critical consideration for loan approval. Its value, location, and potential for generating income significantly impact the lending decision. Typically, professional property appraisals and inspections are used to validate property value and condition.

Business Plan and Projections: Enact Partners values a comprehensive business plan outlining the loan’s purpose, the project’s scope, and expected outcomes. Such a plan demonstrates how the loan will be utilized and repaid.

Telling Your Story: Telling your best, authentic story about your commercial real estate project can be vital to securing financing by demonstrating clear vision and strategy for success as well as highlighting your experience and expertise. Private lenders, unlike traditional banks, often rely heavily on such narratives concerning a project’s potential when deciding whether to approve a loan.

In Conclusion

Enact Partners specializes in funding commercial real estate loans quickly and provides the flexible financing options needed to buy, refinance, or develop property for business purposes. Borrowers benefit from having a single point of contact and direct communication with the decision maker, which provides transparency throughout the entire loan process.

Because Enact Partners is a private lender, we provide financing solutions often not available through traditional banks. We are not regulated by the Federal Reserve, so our process is easier and faster, with a lot less hassle.

Given the right circumstances, we often go where banks refuse. For example, we are willing to explore opportunities with vacant commercial buildings, movie theaters, vacant land, and other special uses – even horizontal improvements.

Contact us about your commercial real estate loan borrowing needs:

(760) 516-7776 | [email protected] |

The content of this blog is intended for informational purposes only. All information is provided “as is.” No representations are made that the content is error-free. None of the information is intended to be a source of advice with respect to the material presented, topics discussed, websites linked to, and/or other information referenced or displayed. Any and all ideas and strategies presented should never be used by anyone without that person assessing his or her own financial, investment, and borrowing needs, and without consulting a lending professional of financial advisor familiar with the person’s unique financial situation and needs.

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By prioritizing trust, communication, and long-term partnerships, Enact Partners has become a trusted ally invested in the success of clients, and in today’s ever-changing lending environment, that’s critically important.