What Is Commercial Mortgage and Why Would You Avail This Facility?
Commercial mortgage is related to your business and your commercial property. There are different types of commercial mortgage finance available in the market, and these finances can be availed for any business like restaurants, shops, retails business, construction house, industrial segments and for manufacturing units.
- Sometime, people purchase the company along with their brand name and the property owned by the company. In this case, you have to mortgage your whole business to the bank or the lender.
- But most of these businesses apply for the commercial mortgage loan for upgradation of their business and they need to unlock their money through this financing. Through the commercial mortgage, they can get some quick finance, and they can purchase the equipments for upgrading their business or they can purchase some lands to extend their commercial property to increase their production.
- In such cases, banks and other lenders may provide you the commercial mortgage loan based on your property, assets, and business. Whether you want some refinancing or you want to sell out your business for some personal issues, you need to contact with your bank and they can assist you in a proper manner. But most of these banks take much time to disburse the loan and in this regards you can contact with some private lenders to get a quick mortgage loan.
Reasons for taking the commercial mortgage loan:
Commercial mortgage loan helps you to upgrade your business and in this way you can also open some new business venture. Suppose, you have some vacant lands and property, which you do not use currently, then you can mortgage this property to some bank. The bank or the financial houses will evaluate your property and disburse the mortgage loan accordingly. Then you can invest this amount to your business and extend your business by purchasing some new commercial land and equipments.
- If you want to open a shop or restaurant, or you may need to extend your commercial business land to increase the production, then you need to take the land on rent. On the other part, you can purchase the land or shop by cash, or you can also apply for some business loan for the same. In both cases, you need to pay huge interest to the bank. But if you take the same commercial mortgage loan then you need to pay less interest. Even this EMI of the mortgage loan will be less than your monthly rent.
- Apart from that, it is suggested to check the tax benefits of the loan before applying. Almost all the bank and commercial financing companies provide this facility to their customers, and you can claim the tax deduction on the EMI amount.
- Lastly, when you extend your business or you purchase some new commercial lands, shop or heavy equipments it means that after the loan period, the property and the equipments will be yours and then you need not bear any further charges at all.
Advantage of the commercial mortgage loan:
Commercial mortgage loan is very effective for the small business because they can avail the cash loan against their property at anytime, and they need to pay less interest rate. Along with that, they will get the tax benefits for the same. If you need some loan for your business then you can also mortgage your existing commercial property because banks and lenders will disburse higher rate on the commercial property. Then you can upgrade your business, solve the existing financing problems with this loan, and pay the installments of your mortgage loan in an easier manner.
So now, do not take any burden for your business, and when you need money for your business, just contact your bank for commercial mortgage loan.