Small Business Loans: Buy Commercial Property

How to get a small business loan to buy commercial property

Most new business owners need to find small business loans for real estate in order to get the property they need to run their business. It's not common for a start up company to have the cash on hand needed to buy a property. Mortgage companies offering SBA loans for commercial property are a great help.

While it may take more time, it's always a good idea to shop around for small commercial real estate loans. You always want to make sure that you are getting the best possible rate. Even a difference of one percent can make a big difference in how much you pay total for the loan.

When you apply for small business loans to buy commercial property, remember the following:

1. Banks want to know your credit score and business plan before they will give you a small business real estate loan.

2. When using a small business loan for commercial property, you may be able to get lower monthly payments if you secure a loan with a balloon payment at the end of the term.

3. You will need to begin repaying your small business property loan immediately. You should have the cash flow to cover this.

Find companies that can offer you a commercial property SBA loan

The Small Business Administration is a government program that helps small businesses get started. Loan money comes from a bank, but the SBA backs that money. This makes regular banks feel more comfortable when they lend you money.
SBA offers a free course teaching you about the loan program. Once you understand the process, consider contacting Bank of the West, which is a lender that can give SBA loans.

Buy commercial property with a small business loan

You can get a commercial mortgage through most banks. Make sure you let the bank know that you are a business owner looking for commercial property. Commercial and residential mortgages are quite different.

Find small business loan providers for commercial property

Commercial property can be quite expensive based on the type of property you want to buy and the area of the country. If the amount exceeds certain limits, you'll need to apply for a jumbo mortgage. Look for banks that offer these jumbo mortgages for small business owners.
  • If the large banks turn down your request for a commercial property small business loan, talk to a small local bank. These banks typically offer more personalized services and may be more likely to work with local business owners.