Types of Real Estate Loans
Traditional commercial real estate loans help many people achieve their goals, but some investors and property owners may want an alternative. Stated income commercial real estate loans provide an avenue to property ownership or refinancing that focuses on the value of the property more than the credit of the applicant. Apartments, commercial buildings, warehouses, and other businesses may qualify for these loans if their value covers associated costs, like the mortgage and insurance.
Potential Benefits of Stated Income Loans
Traditional loan applications require extensive paperwork and may take a long time to process. The application process for stated income loans is often much faster because less paperwork is required of the applicants. Borrowers may secure needed funds much more quickly, provided they meet the core requirements. If approved, applicants may use the funds to purchase additional properties, consolidate debt, or make improvements to existing properties. Borrowers may also use the funds to build capital.
The Basics
Prospective borrowers should know the facts about these loans before applying to avoid processing delays. While stated income commercial real estate loans do not require perfect credit, the terms may be better with a higher score. The following guidelines generally apply to stated income loans:
- Applicants may borrow up to $500,000
- These are 25-year, fixed rate amortized loans
- W-2 and/or self-employment documents are required to apply
- Applicants should have a minimum credit score of 600
- Up to 70% loan-to-value (LTV) for smaller investments properties (1-4 units), and up to 75% LTV for larger properties with a credit score of 700 or higher
- Up to 65% LTV for retail, warehouse, office, and self-storage properties
Get the Advice You Need
There is much to consider when applying for this type of loan, but you do not need to make the decision alone. Contact Pacific View Funding today for professional and courteous guidance in applying for a stated income loan. Our team will review your information and help you decide if these loans are right for you.