Close Your Commercial Real Estate Loan in 30 Days
So you want to close your
commercial loan or
loan fast, in under 30 days. Is it possible? There are
websites on the Internet that say they can do it, and
since it was said on the Internet it must be true,
Think again. It's possible, very possible, but
everything must happen absolutely perfect to close a
commercial mortgage loan in under 30 days.
After all a commercial appraisal, on the average, takes
about three weeks. That leaves only a few days of
underwriting your commercial mortgage loan request before the appraisal is ordered, and a few
days to complete due diligence once the appraisal
has been received to be able to close a
mortgage loan in under 30 days.
So then, how is it possible to close your commercial
loan in under 30 days? Believe it or not, it's really up
to you, not your commercial lender!
First, make sure you are dealing
directly with a commercial lender, bank, or very experienced
commercial mortgage broker.
It would be best to deal with a bank or
lender that has an appetitive for your loan type - if
you need an apartment loan, don't go to a bank that makes
apartment loans but specializes in owner occupied
commercial loans, you may close, but most likely not in
under 30 days.
Next, you must prepare a perfect
package to submit to the lender, and we mean perfect.
Here are a few tips:
- Make sure your two most previous years - both
personal and business - tax returns are complete and
- Prepare year-to-date personal financial
statements and business operating statements - no
more than 60 days old
- Locate your 3 most recent months bank statements
- all pages
- If you are refinancing a
commercial mortgage loan: make sure you have your
payoff statements, survey, title policy, and
appraisal in hand
- If you are purchasing: the sales contract must
be valid. If the contract will expire prior to the
closing of your commercial real estate loan, get an
- For investment properties, make sure all tenant
leases are valid - ensure lease terms match rent
- Put you accountant and lawyer on notice upfront
that you are applying for a commercial loan. Inform
them you will need up-to-date business and financial
documentation. You will be surprised how many times
a borrower will hear, "thanks for telling me, I was
going on vacation for a couple weeks, I will prepare
what you need before I leave"
Once you put together the "perfect
commercial mortgage loan
package," take it to your
and have the lender review your
"perfect package." Ask them if there is anything else
they need. Once they answer, ask again, and again, it's
inevitable they will always come up with something each
time you ask. Once you have worn them out, you can
leave, or hang up!
Make yourself available to your
commercial mortgage lender.
Provide the lender with your phone number, cell phone
number, and email address. You can't waste a day with
missed or unreturned calls or emails when attempting to
close your loan fast!
When the lender requests a document,
needs clarification, or requires other information,
provide the information immediately. And don't assume
that if you faxed, emailed - or for that matter mailed -
a response, that the
commercial lender received it. Call, be a
nuisance or pest, just make sure the lender received
your information and it's what they asked for.
Once the appraisal has been ordered, its
time to tie up the loose ends. Contact the
lender and make sure nothing else, except the appraisal,
is needed to close your loan.
While you're at it, contact the title
company, or closing agent. Make sure the title has been
ordered, the survey ordered - if needed, and make sure
they have the correct phone numbers to obtain any needed
To close your commercial
mortgage loan fast, you
must act as a babysitter, yes a babysitter. banks and
lenders are busy. Appraisers are busy. Title agents are
busy. You must coordinate the communication between all
parties. Yes, you will most likely get some people angry
at you, but to close your commercial real estate loan fast, you must
micromanage the process.
Finally, to close your
or apartment loan in under 30
days you must be realistic and honest with yourself. If
you have a speculative, pie in the sky deal, you won't
close in under 30 days, in fact you probably won't close
at all. But if you have a traditional transaction, you
have all your documentation in order, and you manage the
process, you have a good chance of closing your
commercial real estate loan or apartment loan in under 30 days.