Purchasing property is an important decision in both commercial and residential purposes. While most of us try to keep it restricted to residential property, but now we have seen a growing trend of commercial property investment. This is a loan scheme that allows an individual to invest in commercial property. Business owners or self-employed individuals can get the ultimate benefit from this scheme. This loan amount is used for purchasing commercial property, investing in land or expanding the business.
Who can apply for Commercial Property Investment?
The following people are eligible for applying the Commercial Property Investment:
- Individuals who are self-employed
Note: Before you go ahead with commercial property investment, you must know that this loan is different from residential finance. You need to show proof of your business and other information to get the approval of the loan.
Use of Commercial Property Investment:
If you are planning to apply for this loan, you must know what all you can use this loan for:
1. Buying a commercial property
2. Taking a property on lease
3. commercial property investment enables you to use this loan for office renovate
4. Flexible repayment makes this loan a good option for those who wish to expand their business or open a new office.
Finding the right lender:
One of the key things that you must take into account while applying for commercial property investment is to choose the right lender. There are various factors that impact your loan application and EMIs. It’s important that you must choose the right loan provider. One of the first things that you must take into account is the rate of interest. It directly impacts the EMI, which eventually decides your repayment capacity. Commercial properties are expensive, and the LVR offered by the lender is not as high as residential property. You will get a maximum LVR of 70% but, in the case of residential property, it is up to 95%. So, you must be ready to put in a good amount if you decide to invest in commercial property.
Another key factor that you must not miss is the repayment tenure. This may vary from bank to bank. The repayment tenure also impacts the EMI. If you decide to go ahead with a longer tenure, your EMI may not be high, but you will be paying the interest rates in the long run. So, make sure that you strike a balance between the interest rate and loan tenure before you make a decision to apply for the same.
Another important factor that may add up to the cost is the charges and fees. Most of the banks charge a certain amount as an administration fee or application fee. If you have decided to go ahead with commercial property financing, then you must keep these pointers into consideration.
There is also a probability that you may encounter a scam, to save yourself from; this, it is important that you must choose the loan provider wisely. Scour the internet, approach different banks and lenders, speak to them and then make a decision.
Wrapping it up: The article would have briefed you about commercial property investment. Whether you are planning for business expansion or starting a new venture or clinic or shop, you would need money for the same. Not everyone would have the money, but choosing commercial property, not only saves you from the burden of making the payment upfront, but it will also help you to get the desired property in a hassle-free manner.