Explore Hidden Goldmine Types in Commercial Real Estate Loans
Types of Commercial Real Estate Loans
There are several types of commercial real estate loans, each with distinct characteristics and benefits:
1. **Traditional Commercial Mortgages**: These are similar to residential mortgages but typically have shorter terms and higher interest rates. They are often used for purchasing or refinancing commercial properties.
2. **SBA 7(a) Loans**: Backed by the U.S. Small Business Administration, these loans are ideal for small business owners looking to purchase or renovate commercial properties. They offer competitive interest rates and longer repayment terms1.
3. **Bridge Loans**: Short-term loans designed to bridge the gap between buying a property and securing long-term financing. They are useful for investors who need quick access to funds but come with higher interest rates2.
4. **Hard Money Loans**: These are asset-based loans often used by investors who need to secure funding quickly. They are characterized by higher interest rates and shorter terms but can be a valuable tool for those looking to flip properties or invest in distressed real estate3.