With the Federal Reserve’s decision to raise the federal funds rate (mortgage interest rate) now is a great time for brokers to seek out portfolio mortgage lenders who offer long-term, fixed-rate solutions for commercial borrowers. Fixed and fully-amortizing terms offer a number of benefits to your borrowers, and adding a lender who offers this type of small-balance commercial mortgage will help you to stand out amongst other brokers.
Here are some perks to working with these lenders:
Less pressure for your borrowers:
While it might seem like ballooning bank loans and short-term hard money deals are the only options for commercial borrowers, there is a middle ground. However, APEX offers fixed and fully-amortizing rates for up to 25 years. While the life of the loan might be much shorter than that if your borrower decides to refinance or pay off the loan, they can rest easy knowing that paying off their loan in a short time-frame isn’t necessary.
Rates are still low, so an adjustable-rate mortgage might seem appealing right now. However, the rate could increase substantially over the life of the loan depending on the lender’s index and the markets. If your borrower is locked into a fixed-rate mortgage, they don’t need to worry about their monthly payment suddenly increasing.
Portfolio lenders like APEX don’t sell off their loans to other companies, so your borrowers will be experiencing the same great service throughout the life of their loan. This generally makes for a much better experience overall for the borrower and, as a result, good recommendations for your brokering business.
Brokers who choose to work with portfolio lenders offering fixed-rate, fully amortizing loans are doing both their borrowers and themselves a great service. By getting your borrower the best possible deal, you’re helping them to achieve their financial goals while building up trust and credibility as a commercial mortgage broker.