Mortgage lenders in Maryland enable business owners and real estate investors to purchase property within the state at affordable rates. Many companies are available throughout the state. Before an investor starts to work with these lenders, they should understand the terms most often associated with loans and applications. Terms like fixed rate mortgage, annual percentage rate and construction loan should be understood so an investor can choose the right loan.
Mortgage brokers provide a potential property buyer with mortgage options available to them from various lenders. The broker works to find loan options for the borrower.
Fixed Rate Mortgage (FRM) vs. Adjustable Rate Mortgage (ARM)
When considering mortgage lenders, many borrowers will want to know what types of mortgages are offered. Fixed rate mortgages are the most traditional. They have an interest rate that will not change or adjust throughout the life of the loan. The opposite type of loan is an adjustable rate mortgage, or ARM. The interest rate on this type of loan may adjust one time per year according to the contract details.
Commercial real estate financing
Commercial real estate financing is a term used to describe the many types of secured loans available to business owners. This includes loans for single family and multifamily residential properties, income producing properties, commercial properties and institutional properties.
Annual Percentage Rate (APR)
The annual percentage rate, commonly referred to as APR, is the interest rate charged by the lender to the borrower purchasing real estate. This rate is used to determine the "true cost of a loan" and must be provided to borrowers by mortgage lenders prior to the application process.
A construction loan is provided to property owners wishing to build a house or other dwelling. This loan is secured by the real estate, but is based on the estimated value of the completed project. Two types of construction loans exist: a new home construction loan and a renovation loan.
Small Business Administration (SBA) business lending
The Small Business Administration offers several loans for business owners including the SMB 7(a) and SBA 504 programs. Local lenders can help businesses qualify for these loans, which may allow them to purchase, refinance, cash out or invest in commercial real estate.