If you are new to commercial real estate financing, you’ll want to get a firm understanding of the differences between a residential and commercial mortgage loan.  Residential real estate uses a debt-to-income formula for judging your ability to repay a loan while commercial real estate is based on the Debt Service Coverage Ratio (DSCR) formula to qualify.  This means that to qualify for a commercial loan, you’ll have to know what your projected Return On Investment (ROI) will be when making a commercial property purchase or refinance.

The cash flow generated from your commercial real estate property will be one of the factors in determining both the value of the property as well as its future return.  The type and amount of your commercial loan is also dependent on other factors, including your business and personal credit history, your net worth or financial strength, the type of property and its overall condition, its cash flow, the geographical location of the property, and the general economic outlook of the local market.

The first step to purchasing or refinancing your commercial property is to know exactly how you’ll use the property.  What type of property will you acquire?  How will the property be used to improve your cash flow and financial goals?  How long will you hold the property?  Will you be an owner/tenant or just an investor?  And do you have an exit strategy?  These are all questions you’ll want to think about before applying for your commercial financing.

After you’ve established the market need and use for the property, you’ll also want to analyze its current and future cash flow that will contribute to your ROI.  So give us a call today, and we’ll help you get started and answer any other questions you may have.

Minimum	Special	Complete		Commercial Mortgage Document Checklist
			Doc. Group
				(Sorted by Document Group)
		X	Borrower	Personal Resume of Borrower's) (All who own 20% or More)
		X	Borrower	2 forms of I.D. Drivers License and Social Sec Card
		X	Borrower	Personal Financial Statement – (Net Worth)
X		X	Borrower	Three (3) Years Personal Tax returns (Including all K-1’s)
X		X	Borrower	Borrower's Credit Report
X		X	Borrower	Borrower's) Credit Authorization and Release
		X	Borrower	Three (3) months of Personal Bank Statements
X		X	Business	Three (3) Years of Corporate Tax Returns (All Schedules and Attachments)
		X	Business	Three (3) years of business Financial Statements, P&L, Bal. Sheet, Cash Flows
		X	Business	Latest Business Interim Financial Statement (within 90 Days).
	X		Business	Accounts Receivable and Accounts Payable Aging Reports.
	X		Business	Accurate Inventory Listing (If Applicable)
	X		Legal Entity	Copy of Corporate papers on Sub Chapter S Corp business held in.
	X		Legal Entity	Copy of State and Local Licensing necessary to operate business.
	X		Legal Entity	Articles of Incorporation
	X		Legal Entity	Copy of By Laws (If Corporation)
	X		Legal Entity	Borrowing Resolution of Board of Directors (If Corporation)
	X		Legal Entity	Copy of Partnership Agreement (If Partnership)
	X		Legal Entity	Borrowing Resolution (If Corporation, Partnership or Limited Liability Company)
	X		Legal Entity	Certificate of Good Standing
	X		Legal Entity	Business License
	X		Property	Latest payment statement on note for property.
		X	Property	Copy of Appraisal (If Available).
		X	Property	Title Work On Commercial Property (If Available).
		X	Property	Survey of Commercial Property (If Available).
		X	Property	Insurance on Commercial Property
		X	Property	Photos of the Commercial Property From All angles
	X		Property	Environmental Site Questionnaire (Indemnity Agreement)
	X		Property	Rent Roll / Leases Schedule of Property Owned (Non-Owner Occupied)
	X		Property	Purchase Agreement on Commercial Property
		X	Property	Promissory Note on Commercial Property
		X	Property	Mortgage / Deed of Trust on Commercial Property
	X		Property	Estoppels Letters and Subordination Agreements
	X		Property	Zoning, Use and Occupancy
	X		Property	Copies of Certificate of Occupancy/Building Permit
	X		Property	Copy of Management Agreement