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How to Close Your Commercial Loan in 30 Days

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Close Your Commercial Real Estate Loan in 30 Days

 

So you want to close your commercial loan or apartment 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, right?

 

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 commercial 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 commercial real estate loan 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 filed
  • 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 extension upfront
  • For investment properties, make sure all tenant leases are valid - ensure lease terms match rent roll
  • 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 commercial lender 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 payoffs.

 

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 commercial loan 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.

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