If you’re a residential mortgage broker interested in closing commercial deals, you may be hesitating because of some misunderstandings about the process. For many, closing commercial mortgages is a simple way to earn additional income, and it can be for you too.
Here are some common misconceptions about commercial mortgages as well as the truth about working on these deals:
Closing commercial mortgages requires extra work.
Generally, this depends on the lenders with whom you choose to do business. Most commercial mortgage lenders will review a deal as long as a broker submits a 1003 or commercial mortgage application, a credit report with scores and tradelines, and a summary of the deal. In order to minimize your work load, seek out commercial mortgage lenders who handle the processing of each deal for you.
Commercial lenders only handle larger loans.
Again, this is contingent upon the lenders with whom you develop business relationships. There are many lenders who deal specifically with large-balance commercial mortgages, but there are a number who handle small-balance deals. These deals are a great place to start if you’re new to commercial lending.
Commercial mortgages are time consuming.
If you’ve decided to focus on small-balance commercial mortgages, you’ll see that they’re not all that time consuming, especially when you work with the right lender. As mentioned above, a lender who handles the processing of your deals is a great choice, especially for residential brokers who are looking to close the occasional commercial deal. This allows you to focus on your core business while earning additional income.
Commercial mortgage leads are hard to find.
If you’re a residential mortgage broker, you probably already have all the connections necessary to find commercial mortgage leads. You already know bankers who are looking for alternative funding sources for their customers who can’t qualify for a traditional commercial mortgages, as well as CPAs, attorneys and real estate professionals who are looking to help clients obtain financing. Additionally, you’ve probably worked with self-employed borrowers to fund their homes, so you’ll be a trusted source when they seek a mortgage for their business.
Closing small-balance commercial mortgages is a fast, easy way for residential brokers to expand their business and increase their income. Don’t let the above misunderstandings keep you from earning more today.