Making A Decision About A Commercial Mortgage
Choosing a commercial mortgage is an important part of the process of purchasing commercial real estate. There are three types of mortgages to consider- the fixed rate loan, the adjustable rate loan and the convertible rate loan.
Mortgage loan rates can be described as being the percentage of interest that you will pay on the amount of money that you borrow for the loan you want to purchase a commercial property. You can choose a fixed rate that will always remain at the same percentage or you can choose an adjustable one that rises and falls based upon the prime rate. Or if you want you can compromise and choose a rate that is a combination of these two rates in one.
There is no one size fits all commercial mortgage. There are different types of mortgages with different types of rates. If you want to take out a mortgage loan then you should book an appointment to sit down with a lender from your financial institution and discuss your options. The three types of loans to choose from include the: Fixed rate loan, adjustable rate loan, and convertible rate loan
You cannot know which commercial mortgage is right for your situation until you find out what each one has to offer. Let us look at that now.
Options in Commercial Mortgage Loans:
The fixed rate mortgage loan has a rate that remains fixed, which is to say that it stays the same throughout the course of the mortgage's term. It is not affected whatsoever by any changes that occur with the economy.
The adjustable rate mortgage loan offers an interest rate that is affected by the prime rate of the economy. When you choose a mortgage loan for your commercial real estate that has an adjustable rate than the rate will always be lower than the rates you will find for other kinds of loans of a commercial nature.
The convertible rate mortgage loan does not refer to a type of car! This type of loan is a combination of the two already mentioned here. At the start when the mortgage first gets underway there is an adjustable rate, which begins with the lowest interest rate that you could possibly have. The low interest rate will then be subject to the ups and downs of the prime rate.
With the convertible mortgage at any point in time you have the option of changing the interest rate you have from the adjustable rate to the fixed rate. For many people this type of loan is ideal. You are able to lock in a fixed interest rate for a longer term when the mortgage market rate can be thought of as reasonable.
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ABOUT THE AUTHOR
A Middltown NJ commercial mortgage can bring you closer to your goals. To find out more about your options, visit: http://www.charlesmartinmortgage.net.