One of the most common reasons that borrowers seeking a small-balance commercial mortgage need alternative financing is because banks and other traditional sources are unable to close the loan within the necessary time frame. As a commercial mortgage broker, you’ll need to connect with non-conforming lenders in order to provide these borrowers with the financing that they need.
Here are some questions you should ask a small-balance commercial mortgage lender when time is of the essence for your borrower:
What documents are needed to review the deal?
Before you submit anything, it’s best to ask your lenders what they require in order to take a look at your borrower’s commercial financing request. Banks and other traditional lenders are going to require more documentation because of stricter regulations, so if your borrower is unable to provide what is required or if time is of the essence, a non-conforming commercial mortgage lender might be your best option.
How long will the initial review take?
While it’s important to keep in mind that a lender needs to review your submission as closely as possible before they begin the formal underwriting process, some lenders really take their time, leaving you and your borrower in limbo. Patience is important, but it’s frustrating to wait weeks just to hear, “No.” Try to work with lender who can find a nice balance between carefully reviewing the scenario and giving you the quickest possible “yes” or “no.”
On average, how long does it take the loan to close?
Every small-balance commercial mortgage scenario is different, but when you’re looking for non-conforming lenders, it’s best to ask them the average closing time for their loans. This will give you an idea of whether or not they’ll be able to finance your borrower’s request in the necessary timeframe and allow you to better evaluate whether the lender is the best fit.
When your borrower needs a small-balance commercial mortgage loan, the above questions will help you to get them the financing they need as quickly as possible. It’s important to understand the capabilities of non-conforming commercial mortgage lenders in relation to the needs of your borrower. This knowledge will not only benefit your borrower, but will allow you to close more loans and earn additional income quickly.