In financing a commercial building or refinancing a business property, the phrase loan-to-value or LTV is often used.
Loan to value is a ratio that expresses the amount of a mortgage as a share of the total appraised price for a property. For instance, ifentrepreneurs borrow$130,000 to get a commercial building worth $150,000, the LTV proportion is $130,000 / $150,000 or 87%.
Loan-To-Value is a crucial part of how much leverage you are using to govern real estate. The higher the LTV, the less money your business has to speculate in the commercial property.
ABOUT COMMERCIAL PROPERTY REFINANCING WITH HIGHER LTV
Loan to value is one of the key risk factors that commercial building banks appraise when qualifying for a mortgage. The danger of default is foremost of lending choices, and the likelihood of a bank absorbing a loss in the foreclosure increases as the amount of equity decreases. Therefore , as the LTV proportion of a loan increases, the qualification laws for certain mortgage programs become much more strict. Banks can need borrowers of high LTV loans to buy Mortgage Insurance to give protection to the lender from the buyer default, which increases the expenses of the mortgage.
REPORTS ABOUT COMMERCIAL BUILDING FINANCE AND LTV
What?s new is that for a set time, your company can get commercial property refinancing with a loan to value of ninety percent by employing a new US administration program from the Small business Administration. It?s called the SBA 504 program.
The SBA 504 program let?s you refinance a commercial building loan with a lower monthly payment,at a reduced interest rateand with less personal risk with a 90 percent LTV.
So if you own a commercial building for your business, this 90% LTV program from the SBA will help you find financing even with lower credit scores.
Ask Venture Funding Group about commercial building finance and the SBA 504 program. Call 1-800-578-4884 for consultation and advice or sign in to http://sbaloan.com to learn more information and have your claim sent to you.
Venture Funding is a FULL service business advisory company. Their team of consultant will answer all of your questions and they are skilled in commercial properties for entrepreneurs. Thru tons of available commercial loan programs they will get you the financing you want.
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