Do You Make These Simple Mistakes In Commercial Mortgage Toronto?
Getting a commercial mortgage can be just as pleasant and exciting as a regular mortgage, but you still
need to be prepared to do things right. There are a few common mistakes you will want to avoid. Let’s
take a look at a few of these mistakes and see how to avoid them.
Five Common Mistakes Made When Getting A Commercial Mortgage
➔ Thinking costs of residential and commercial mortgages are the same. There are a few
differences between commercial and residential mortgages, and your lender will be able to explain
the differences in detail. One big difference is that costs are much higher when purchasing a
➔ No business plan: Having a plan that includes operating data and financial information will only
show the lender that you are responsible and reasonable. You show you have goals for the future.
Bring that information and all other needed documents when you go to discuss your business.
➔ Hire an inexperienced lawyer: Don’t try to go with the cheapest lawyer you find. Get a lawyer
who has experience in handling this type of real estate loan, and has a proven record of success.
Even though hiring a friend, or the cheapest, lawyer may seem good right now, it can cost you
➔ No ready cash: There should be some sort of available cash before you apply for a commercial
loan. Many lenders like to see you are ready and prepared to find some of the projects.
➔ Did not shop around: Some people take the first offer given to them. Use discretion and research
to sort through loan offers. It is good to see your options before settling on one loan. You need to
pick what is right for you.
➔ No plan for the funds you will be receiving: If you have a plan and cal tell your lender what you
want to do with the loan, the lenders will be more than willing to give you a loan. Sometimes, the
lenders will also want to see if you have a time frame for any project completion.
Lenders will always keep your credit, your capacity to pay and your collateral in mind when you apply
for a commercial mortgage. One mistake you can easily make is being unprepared with information. Here
is a shortlist that will help you have all the documentation prepared.
• Liability statements
• Assets statements
• Tax returns
• Your business’s financial records
• Financial history records
• profiles of any directors or business partners.
You will obviously want to avoid making any mistakes when you are applying for a commercial mortgage. By knowing the most common mistakes, you can prepare yourself to be successful. Contact your mortgage broker in Toronto today, and discuss what options are best for your business.
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