For many borrowers in need of a commercial mortgage, time is of the essence. From paying off a ballooning mortgage in a short timeframe to getting the funds needed to purchase a property, there are a number of situations in which borrowers need cash fast. As a broker, it’s your job to find a lender that can close these deals quickly in order to meet your borrowers’ needs. In situations like these, small-balance commercial mortgages are often your best bet.
Here’s what you should be aware of when submitting a time-sensitive mortgage request:
Ask about the documents the lender will need to review a deal.
The first thing you need to do when preparing to submit a commercial mortgage request is to find out what the lender will need in order to evaluate the scenario. If you’re working with banks or other traditional lenders, you’ll need to gather up a lot of documentation, which could be time-consuming. Small-balance commercial mortgage lenders generally need less to take a look at a deal, and are better at getting you and your borrower a quick “yes” or “no” than the bank.
Understand the lender’s approach to underwriting.
Because traditional commercial lenders require more information to look at a deal, the evaluation and underwriting of the deal often takes time. If you’re working on a time-sensitive deal, this can be an issue, and a small-balance commercial lender with a quicker, more common-sense approach to underwriting is likely to be a better option.
Find out what their average time frame is when it comes to closing.
The faster a deal closes, the sooner your borrower gets the money they need and the sooner you get your commission. So, when you’re considering working with a lender, find out their average closing time. This is especially important if your borrower needs the money fast, since traditional lenders generally can’t close a deal as quickly as a non-conforming lender.
It’s crucial for brokers working with borrowers who need a quick closing to consider the above information when working on these deals. Asking about what your lender needs to evaluate the scenario, their underwriting process and the average timeframe in which they close mortgages will allow you to select the best lender for your borrower. The deal will close more quickly, and you’ll get your commission check that much faster.