Speeding Up The Commercial Private Mortgage Process
“Here Are A Few Ways To Speed Up The Commercial Private Mortgage Financing Process”
While private mortgage lenders that finance commercial properties are likely to be measurably faster than a bank or institutional lender when it comes to completing the application to funding process, there can still be a considerable amount of time pass before everything is completed.
The two single biggest items that are key to any type of commercial mortgage approval are the property appraisal and the environmental assessment.
Both of these take time to complete, which can hold up the process for even private mortgage financing.
The big difference between most private lenders and banks and institutional lenders when it comes to these items is that private lenders tend to be more flexibility in terms of working with the information you have available.
For instance, if you’ve completed an environmental audit in the last two to five years on the subject property and there hasn’t been in material change in the use of the property since the assessment was completed, a private lender may be willing to use the dated appraisal and not require that you get a new one completed. This will vary by lender, but with privates there is more of a common sense element to looking at this information versus the pure black and white rules of an institutional lender.
The same can be said for a real estate appraisal, although using an appraisal more than a couple of years old may not work all that well either.
The big difference with an appraisal is having one done by a recognized, or well known AACI certified appraiser. Even if a private lender has a “favorites list” of commercial appraisers, they may still be willing to utilize an existing appraisal from someone off of their approved list, provided the appraiser is well known and the appraisal is not too old.
Having both of these items in hand when applying for a commercial mortgage through a private lender can cut down the time line considerably from point of application to funding.
The key is to have these documents 1) recently completed, 2) completed by a recognized appraiser for the purpose of property financing, 3) in an electronic format so that all the pictures, graphs, maps, and drawings can be easily viewed, plus it makes the reports appear much more professional than an office photocopy; and 4) make sure that the appraiser are prepared to provide transmittal letters to future lending sources you may be speaking with.
If you are in need of commercial mortgage financing and would like to consider both bank and private money sources, I suggest that you give me a call so we can go over your requirements together and discuss the different options that are available to you.