Are you looking for commercial mortgages in Toronto? Their requirements are higher than their residential counterparts. The reason is simple. The value of these loans is usually a lot bigger.
Here’s some of the qualification criteria that you’ll need to meet.
- The down payment for one of these properties is higher than with a residential purchase. For example, on a mixed property you usually need to come up with between 20 and 35%. A commercial property can require as much as 50%. Keep in mind that your risk profile affects the amount of down payment that will be required.
- As your commercial mortgage broker in Toronto, we can advise you about how your current business situation comes into play. Lenders expect your enterprise to be up and running and turning a profit. More than likely you’ll need to come up with your financial projections and a business plan. Some lenders will even want to see a net worth requirement.
- Most lenders who deal with commercial mortgages in Toronto will want to see your credit history. Many will want to see the background on both your personal and business credit.
Other Considerations for Commercial Mortgages
There are a few other factors to consider like insurance for your commercial property. The CMHC doesn’t offer insurance for these types of mortgages. They will ,however, look at mixed commercial residential products.
The time frames are different on commercial mortgages too. With the residential mortgage you can usually expect everything to close within 90 days. Closing a commercial deal can take anywhere from two months up to one full year.
There are a variety to look at that can include an industrial or farmland mortgage as well as multifamily residential and commercial plaza products. Using a commercial mortgage broker in Toronto is a good idea because the rates are usually not advertised.
