Main Reasons for Eligibility Denial for Texas Commercial Loans

It isn’t always easy getting a loan. Luckily, recent reports from Pepperdine’s Graziadio School of Business and Management shows that it has been easier for small businesses to get a helping hand from banks. The increase in Texas Commercial Loans is not only boosting the economy, but also leading to job growth. That doesn’t mean though that there aren’t still plenty of denials out there.

Applying for Texas Commercial Loans is usually the easy part of the process, getting approved can be the difficult part. The main reason for loan denials is because the lack of cash flow a company sees. It really all boils down to revenue, and insufficient revenue isn’t going to cut it. A business needs to show that they have a successful cash flow or banks will not be impressed or feel confident that they are going to be getting the loan paid back.

Credibility and stability are factors that play even a larger role in being approved or denied. Without proving credibility or stability, especially with an excellent credit score, there is no reason for funding to be approved. Every small business applying for a loan needs to prove that the extra funding is going to provide extra revenue. Without a good reason for extra money, many banks will not see the need to lend you the extra funds.

With that being said, you should really consider why you are applying for the loan. If you really don’t need the extra money right now, it might be best to not apply. There needs to be a good reason to get the loan and a solid foundation for it, this will lessen your chance of being denied. It is not always beneficial to get a loan when it is not necessary.

Other Factors Can Play a Part in Texas Commercial Loans Denials

Banks take into consideration many other factors as well. They look at the equipment used or available to the small business, the location and also the quality of the inventory. Having an issue with any of these items might give your business fewer options, making it harder and less likely to qualify for any extra funding.

Rotten credit can really affect your chances of getting Texas Commercial Loans!

Of course, credit plays a large role in getting approved for Texas Commercial Loans. Most banks strongly encourage a credit score closer to the 700 mark. If your small business is struggling and you currently don’t have the best credit, consider starting out with a small loan. Your chances of getting a large loan is slim, but try to apply for loans with a smaller amount. That way, you can rack up your credit by making regular payments on time. If you start on building your credit by starting small, then you will have a better chance of getting a larger loan in the future, when your small business will really need it.

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701

About the Author:  Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Are Shopping Malls Still Texas Commercial Lending’s Problem Child?

Malls across the country are dying, but they aren’t beyond hope. New approaches to Texas Commercial Lending and redevelopment stand to save the old titans of retail.

The dying shopping mall has become one of the most enduring (and discouraging) icons of the decade. While ripe for social media parodies, this trend has real consequences for property investors who long ago invested millions of dollars into a once-bustling center of commerce. With the rise of Internet shopping and a new generation of consumers, the shopping mall has also become a sort of parable for other industries. Adapt and innovate or die. Consumers won’t wait around while you figure it out.
According to a report published in The Atlantic, just two thirds of the country’s remaining 1,200 malls are enjoying success. That means about 400 malls nationwide are spiraling toward bankruptcy or already dead. Of course, one industry’s loss is another industry’s opportunity. There is still money to be made in America's shopping malls, even if that revenue isn’t coming from retail sales.

● Dying anchor stores lead the decline - The death of the American mall actually provides an insightful illustration of some important real estate realities in the retail sector. First and foremost, malls saw their decline because department stores were unable to compete with the rise of eCommerce. As a result, department stores began to go out of business. As key anchor stores began to disappear from across the country, remaining tenants were able to pay greatly reduced rental rates. This created scenarios where once thriving malls began to bleed money seemingly overnight.

● Redevelopment is no easy sell - In other sectors of the Texas Commercial Lending industry, updating an obsolete building is much more straightforward. Sell the property off to new ownership, identify a new use for the space and make upgrades as necessary. Making upgrades to a dying shopping mall is not so simple, in large part because malls are typically owned by trusts or groups of investors. They may not all agree on the best next steps for recouping their investment, and this lack of leadership can spell doom for a shopping center that is already in decline. Even worse, finding a redevelopment project that takes an entire shopping mall’s worth of square footage is not a simple task. That’s why so many investors are thinking outside the box when it comes to shopping malls.

● Innovative Texas Commercial Lending offers fresh solutions - Ultimately, the fate of America’s shopping mall will depend on the savvy investors who can come up with new strategies for the empty space. Many times those inspired to rescue a mall are those who have invested in nearby businesses and fear the impact an abandoned mall will have on their foot traffic. Many malls have been purchased by community colleges or purchase for redevelopment into a education or medical campus.

A Private Lender Could Quickly Provide The Capital You Need To Buy A Mall

Those with a winning idea for mall redevelopment are in a unique situation. Purchasing a spacious shopping center space has never been easier, so get creative to take advantage of this one-in-a-lifetime opportunity.

Don’t let uncertainty hold you back from making strategic investments in a uniquely versatile retail properties.

Winners and losers in commercial real estate are determined by who thinks ahead the furthest and the fastest. By working with an experienced private lender, your company can be on the cutting edge of this trend.

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701

About the Author:  Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

3 Tips For Getting Your Next Commercial Real Estate Loan Approved

It’s time to go back to the drawing board if your commercial real estate loan gets denied. These tips can help you turn that failure into a profitable success.

Your company is ambitious and looking to take advantage of a tempting real estate investment. The only problem? The business lacks the immediate capital and your most recent commercial real estate loan was denied. Don’t think that means your commercial real estate project is out of the picture. Your company has ample opportunity to rebound from this rejection. What’s the best way to proceed?

By understanding why your loan application was denied and identifying ways to change up your approach, your company is in a much better position to get an approval. Employ the following strategies to put the odds in your company’s favor:

1. Address Feedback From Previous Applications - Chances are that the lender that denied your application provided an explanation for why your loan wasn’t approved. Perhaps your company’s credit score was too low or the business’ credit history was not sufficiently diverse. Perhaps your company and the lender couldn’t agree to satisfactory terms. Either way, learning the lessons from the first application is critical toward getting the your next commercial real estate loan approved.

If your company is unable to effectively address these criticisms, then it’s important to develop a narrative explaining why these perceived weaknesses are irrelevant. Simply having a confident explanation for holes in your company’s loan application will improve your chances of getting approved.

2. Draft Multiple Promising Business Strategies - Regardless of why a lender reportedly denied your application, it almost always comes down to whether or not the lender was confident your company could successfully pay back the loan. With this in mind, it’s up to your business to do everything it can to convince a lender that they are likely to see a return on their investment. Business plans demonstrate to lenders that your company has defined path toward success.

Depending on other factors in your company’s credit history, this may not be sufficient. Devising multiple contingency plans, illustrating your ability to pay back the loan in multiple scenarios, may be enough to get your loan approved.

3. Consider A Private Commercial Lender - Instead of changing up your approach, why not just change up your lender? Traditional lending institutions like banks have plenty of capital to lend, but strict rules about who, how and when they lend it to borrowers. Working with a private lender promises more flexible options that better line up with your company’s timeline. Private hard money loans have their own advantages, so much so that it’s worth comparing your options even if you can get you loan approved by a traditional lender.

A Flexible Lender Will Help Your Company Create Success Through Real Estate

Start researching your lending options now if your company is preparing to make a major commercial real estate investment.

Don’t let your business miss out on an opportunity for lack of capital.

Local private hard money lenders are ready to facilitate your next commercial real estate investment. Reach out today to learn more about your options for rapid capital.

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701

About the Author:  Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Trends In The Commercial Mortgage Market And What They Mean For You

Lending and borrowing, like the market in general, fluctuate on an almost daily basis. However, like in all markets, there are trends to this ebb and flow that will help to predict future activities and performances of commercial mortgages.

While no one can predict with absolute certainty how the market will respond on a day to day basis, there are certain indicators that allow experts to make projections and determinations about the general direction of the market. This is also true when analyzing the loosen or tightening of the commercial mortgage market. Here are some key trends that are currently affecting the availability and structure of loans.

Lending from alternative sources – Recently, banks and other institutions that specialize in commercial mortgage backed securities have slowed down in granting mortgages. One of the reasons that this is happening is that these institutions are preparing for further regulation that kicks in this year from the Dodd-Frank Act. At the end of 2017, it will be required for lenders to retain at least 5% of any new loan. What this means for potential borrowers is that it is going to be more difficult to obtain funding from traditional sources, so turning to lenders that are not associated with a bank will definitely be on the rise.

Interest Rates – According to the Department of the Treasury, the Federal Reserve bumped the interest rates up at the beginning of 2017. While the economic trajectory of the market is most definitely in an upward swing, even the smallest interest rate increase affects mortgages and lending simply due to the size of loans. With an interest rate increase, expect to see fewer loans, which will constrict growth, but can also be a good indicator for overall economic growth and strength. Higher interest rates tend to reward both borrowers and lenders for reducing risk.

Government Involvement – It is no secret that President Trump is vehemently opposed to regulations in the financial market, so it should come as no surprise that one key item on his agenda is to roll back the Dodd-Frank Act. The loosening of regulation is a double-edged sword, as it was with the mortgage crisis in 2007-2008. While lending becomes easier with less regulation, there is also the potential for a very high-risk environment that could easily end in another crisis. So, if the Trump administration takes aim at aspects of Dodd-Frank that make it harder for banks to lend, it will actually become easier to obtain a commercial mortgage.

How do these trends affect my potential for obtaining a commercial mortgage?

Practically speaking, you will still be able to apply for a loan, regardless of the trends or pending regulations. However, these trends could affect not only who carries your loan but also how difficult it is to obtain a commercial mortgage. There is also a good chance that, if the Federal Reserve continues to bump the interest rates up, that you could end up paying quite a bit more over the lifetime of your mortgage than in previous months and years.

Dennis Dahlberg Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:     (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701

About the Author:  Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

Technorati Tags: commercial loans,commercial lending,commercial mortgage,commercial lenders

Eager To Get Your First Commercial Mortgage? Here's What You Need!

As significant as the decision to go into business is, deciding to expand is even bigger. Not only are you taking on more responsibility, but you will need to take on a loan secured by your existing commercial property—or a commercial mortgage.

You have already done the hard part. A few years ago, you came up with a winning business idea, developed a business plan, obtained a loan, and opened your business. There were some growing pains along the way, but you powered through them.

Business is now going so well that you think it might be time to expand your operations. Maybe it is time to make your current place bigger or open a new office in another city. Whatever you want to do, there is one thing you are going to need—money.

Time to go to the bank and take out your first commercial mortgage, a loan secured by commercial property. There is just one question that has to be asked: How do you do it?

Step One: Talk To A Lender.

Before you start the process, it would be smart to find out what it entails. If you know a lender, make an appointment and talk to him or her. Find out what it would take to get approved for a mortgage in your area and what kind of interest rate you can get. This way if you don’t meet any of the requirements you don’t waste time and know where you have to be before you try again.

Step Two: Scope Out What You Want To Buy

After talking to a lender, you should have some idea of what you can get approved for. Talk to a realtor and ask them to point in the direction of locations you can afford that will meet your needs. They should also be able to tell you whether the seller is flexible on the price.

Before you move onto the next step, make sure you have your first choice in mind.

Step Three: Choose a Commercial Mortgage Lender.

If you already don’t have a commercial mortgage lender in mind, pick one out. Shop around a little to find who will offer the best rates and terms as well as the most money. Don’t rush the decision because it will affect how much you will end up having to pay back.

Step Four: Make An Offer

You know the location you want and how much you can get. Time to make an offer to the seller. Since you already have approval from a lender, you will be a more attractive candidate.

Step Five: Negotiate The Final Deal

As you negotiate with the seller, be sure and talk to your lender every step of the way. The quicker they are aware of things, the better. That way, if there is going to be an issue, they can inform you of it sooner.

Step Six: Time to Close on Your Commercial Mortgage

Once you have the deal done and approved, sign your commercial mortgage papers and get to work!

Dennis Dahlberg Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel:  (623) 582-4444 
Texas Tel:      (512) 516-1177 
Dennis@level4funding.com
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027

111 Congress Ave |Austin | Texas | 78701    

   

About the author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true.

Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

Commercial Mortgages: How To Evaluate Your Eligibility

Before you consider commercial mortgages, it is important to know what you need to qualify for one. Lender requirements are often just the beginning.

Commercial mortgages i.e. non-residential mortgages are nothing to sneeze at. In other words, you’d be surprised how much of an impact commercial mortgages have on the overall financial future of companies. Consequently, when it comes time to enter the vast world of non-residential mortgages, it is extremely important to your eligibility. Of course, you may be asking yourself, aren’t non-residential mortgages loans similar to most mortgage loans? Well, obviously the answer to that question is no.

In general, non-residential mortgages are viewed as high-risk loans for most lenders, banks, and insurance companies. Due to this industry fact, most lenders or banks have several requirements that a borrower must meet. Moreover, if a borrower is unable to meet all the requirement set out by the lender or bank then there simply is no commercial mortgage in that borrower’s future. At first glance, this may should a little harsh, but as previously mentioned these particular mortgages have a direct impact on the future of the company, which means the borrower’s ability to meet their repayment terms often rest on these requirements.

At this point, you may be fearful of your lender’s requirements for commercial mortgages. But, you shouldn’t be. Your eligibility and your potential lender’s expectation do not have to be at odds if you know what you are up against.

Understanding Your Lender’s Expectations For Commercial Mortgages

Thus without further ado,  these are the standard requirement for most commercial lenders—clear documented property value that is equal to the value of the mortgage, a steady net property cash flow and a named guarantor of income and assets.  

A clear document property that is worth the mortgage is just another way to ensure that there is a loan-to-debt ratio that is acceptable. Typically, this means that a minimum of 75 percent for a non-residential loan.

 A steady net property cash flow is just the long way of saying that your business income needs to be more than your carried debt—at least 20 percent more to be specific.  Lastly, a guarantor of income and assets is a fancy title for, generally, the business owner. But, nevertheless, a guarantor of income and assets is someone who agrees to pay in the event of the business defaulting.  With a guarantor, it is important to note that most lenders will require the standard financial documentation (credit history, personal income, other assets, etc.) to verify that the person left potentially holding the bag can, in fact, pay.

Avoid the Pitfalls of Commercial Mortgages

Now that you know what is required of you for a non-residential mortgage make sure you avoid the pitfalls along the way. This means plan, plan and plan some more. As a future commercial property owner you should always have a clear vision for that property, you should make it a point to shop around before choosing a lender, you should clearly care about the interest rate but make sure it isn’t the only thing you care about and finally make sure there is a true financial future in the property you seek. Taking the time to do all of the above will ultimately save you from unnecessary hardship.

Dennis Dahlberg Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel:  (623) 582-4444 
Texas Tel:      (512) 516-1177 
Dennis@level4funding.com
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027

111 Congress Ave |Austin | Texas | 78701    

   

About the author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true.

Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.