9 Alternatives To Mortgage Based Financing

With conventional financing becoming harder and more difficult to secure, commercial brokers will need to find more creative options for their clients in order to be competitive in the market.

Over the past few months, many brokers have been forced out of the financing business because they relied exclusively on conventional mortgage financing only. It’s imperative that you be able to provide creative and alternative financing solutions and options.

Here are a few alternative options to consider:

Business And Corporate loan opportunities

1.Unsecured Business lines of credit: There are several no collateral commercial loans available for businesses up to $10 Million Dollars. These are typically full dock loan and require the borrower to have good credit.
You should consider using a credit line option to replace your mortgage challenges. The rates will be higher but it’s a way of getting a deal financed when traditional methods aren’t’ t working.

2. Secured Corporate Lines Of Credit
These loans can be used to replace current mortgages. These loans are typically low interest loans and can be secured with receivables, inventory, or other corporate assets. In many cases, these loans can be used to pay off existing mortgages. It’s a nice alternative to a mortgage.

3. Medical and Physician Loans
These loans are available to medical and dental professionals and require at lease 2 years of practice. These loans can be unsecured and are typically at prime rates depending on the clients credit history.

4. Franchise And Business Acquisition Loans
Typically, these loans will be about 80% LTV and require good corporate credit.

5. Equipment Loans
Loans against equipment already owned that is used in sale leas back deals. These loans can range form 50 to 80 percent of the equipment’s value and require good credit.

6. Restaurant loans
These loans are usually unsecured and require that the business has been operative for 6 months. The only requirement usually are three months business bank statements and a current credit card processing statement.

7. Corporate Financing
Corporate financing in the form of bridge financing or business acquisition or expansion financing and even seed capital financing is readily available for numerous sources. These transactions are usually for large amounts and can be structured as equity or debt financing.

8.International Project Financing
Though I have avoided International  financing in the past, it is a very lucrative industry for financing large commercial and residential developments and casino acquisitions generally range from $10 Million and can reach billions for multi location projects. International financing is “HOT”.

9. Commercial Factoring
Factoring is a very lucrative way to generate residual income and focus on the quality of the accounts pledged and the credit of the client. Many small business use factors to meet their weekly and monthly payrolls. As a placement agent, you can earn residual income every time the client factors and submits his account receivables or purchase orders to your funder.

The thing to remember is not to be limited and restricted to mortgage based  financing only. There are numerous alternatives to consider and to explore.

Durante Parks