Real estate is seen as more valuable than ever in the residential department, but what about commercial real estate?
Before the pandemic, commercial real estate was worth as much as $16 trillion.
But, not everyone may be able to afford to put some skin in the game. So, what can you do?
Many options exist for small business lending and finance. Did you know there are alternative lending options to finance up to 100% of your real estate purchase if you’re a small business owner?
This is your guide to break out of the renting cycle and finally own your own space.
One option for you to avoid having to put any money down is to get an SBA loan. If you find the right lender for small business financing, then up to 100% of your loan can be financed!
You can get a loan from anywhere between $250,000 to $5 million depending on how much you need and what your specific situation is. Then, you just have to close between 45-90 days of signing a commitment letter and you will have up to 25 years to pay the loan back.
This is somewhat similar to getting a residential mortgage, except that this is purely being used for investment and business purposes.
Depending on your needs, this is considered one of the best lending solutions on the market.
Lease-Option Purchases or Owner Financing
The next way that you can possibly get the property with little to no cash down is if you do a lease-option purchase.
This allows you to have control over the operations of the property without bearing the responsibility of owning it. Best of all, it takes away your need for a big down payment, because you would pay the property owner every month rather than all at once. At the end of your lease, you’ll have the option to buy the property.
Typically, owners decide to charge businesses by square foot for monthly rent on a commercial lease. This can be favorable if your business takes off faster than you expect.
However, there can be a downside to going this route. You would lose the opportunity to own an appreciating asset, and the property may get more costly once you decide to own.
But, there are alternatives to this if it is not for you. But if you do decide to go this route, you’ll be able to negotiable the amount of rent that goes into future ownership and when you may want to buy the property outright.
Real Estate Refinancing
Finally, refinancing your real estate can help you with the purchase of a certain property. Depending on your property, you may be eligible for this as one of your best alternative capital source options.
This allows for more flexibility with one of your largest expenses and may make it easier to purchase future properties.
Keep in mind, a refinance is only an option in certain situations. You should consult a lender to see if you are eligible for this.
Understand Your Options
Many small business owners don’t realize just how many alternative lending options there are for financing business and commercial real estate purchases outside of traditional bank loans. CAB Capital is passionate about helping small business owners find financial solutions perfectly tailored to their situation and needs.
Ready to get started? Call today.