Private Mortgages Can Save Your Business
“If Your Business Owns Commercial Property And Requires Additional Capital For Operations or Lender Refinancing, Our Private Mortgage Financing Solutions May Be
You’re Best Option Right Now”
As we slowly start coming out of the recession in 2010, more and more businesses are trying to either find working capital to help keep the business going, or they’re trying to find a way to payout their bank.
When business down turns occur, cash flow can become strained and bank covenants can get breached.
Weaker financial statements will not likely allow you to get more financing from your bank and if you’re off side with your banking covenants causing your loans to be called, it may be very difficult to quickly move to a similar banking relationship.
When the business owns real estate, the alternative form of financing in many cases is funding via private mortgages.
Private mortgage lenders are less sensitive to bumps in the road and are more concerned with the underlying asset value, marketability, and the future prospects of the business.
The move to private mortgage financing is temporary in nature to allow the business to rebound back to its normal level of operating profitability at which time it will be able to return to a conventional banking situation that offers lower rates.
In many cases, its unfortunate that your bank will not work with you through what in many cases is a short term decline in business. Refinancing is always time consuming and can be fairly expensive, eating into equity you’ve built up over the years.
But refinancing via private mortgages also provides an option, many times the best option, to quickly inject cash into the business and/or payout a lender who is threatening to take legal action against you.
And if you wait too long trying to find a cheaper solution through another institutional lender, you could see the business deteriorate even further and risk greater losses or even business failure.
The obvious benefits of private mortgages are that they can be much faster to secure than conventional commercial mortgages and because the debt servicing requirements are interest only, the higher cost of financing may not result in higher monthly debt servicing payments. In addition, many private mortgages on commercial property are open after three or four months, so if you are able to get the business back on track quickly and locate a more favorable long term financing source, you can payout the private lender without any prepayment penalties after the initial months have passed.
If you’re like many business owners currently facing a cash flow crunch or lender repayment demand, give me a call so that I can quickly assess your situation and provide private mortgage options for your consideration.
About the Author Joe Walsh
I'm a Toronto Mortgage Broker that arranges mortgage solutions on residential and commercial real estate property. With over 30 years of mortgage financing experience, I'm able to quickly assess your financing requirements and provide relevant solutions for your immediate consideration. Joe Walsh Google+ YouTube Channel