Commercial Mortgages in Ontario.
What is a Commercial Mortgage?
A commercial mortgage is a loan that is advanced to you or your business using your commercial real estate as collateral. This is identical to a homeowner loan in which case you receive a mortgage that is registered against your home. Similar to how you are a guarantor to your residential home mortgage, your business or corporation are often loan sponsors for commercial mortgages. The title of your commercial property can be help by you personally, but most often held by a holding company or numbered company. You will learn how the loan application and review process for a commercial mortgage is much different than the process to obtain a residential mortgage.
There are many reasons as to why you might be seeking financing for commercial real estate in Ontario. The reality is, it’s important to work with an experienced and reliable mortgage partner. Not only will they be able to assess your scenario, they can leverage their knowledge and access to multiple funding sources. In the case of mortgage financing, options are a very good thing. In theory, access to multiple lenders equate to multiple products, options, and interest rate offerings. Undertaking to take on the entire process on your own isn’t impossible, but it is most practical to leave the grunt work to an Ontario licensed mortgage brokerage and mortgage lender.
We are often approached by clients who have had their commercial mortgage application rejected by a traditional lender. Although there are always many reasons behind the banks decision, the usual ones have to do with the following:
- The property type
- The property location
- The credit-worthiness of the sponsors / guarantors / borrowers
- The financial status of the sponsors / guarantors / borrowers
- Debt service ratios that do not conform to institutional guidelines
- In the eyes of the lender, the borrowers lack the required experience to take on the project
- Environmental concerns
- Inability to provide creative mortgage solutions
There are instances where you might be a candidate for traditional commercial mortgage financing however your entire needs are not met. It might be that your traditional lender cannot provide you with the full mortgage amount that you require, have imposed rigid underwriting requirements with difficult conditions to fulfil, or are unable to close as quickly as you require.
Commercial Mortgage Purposes
- Secondary Financing
- Equity Take-Out
- Capital Improvements
- CMHC Multi-Family Financing
There are countless reasons and purposes as to why commercial mortgage financing can be beneficial to you. Whether you are looking to purchase a commercial property for your business, or for investment purposes, amazing options might exist in the marketplace. Refinancing a mortgage might enable you to access lower interest rates which will reduce your monthly payments and allow you to retain more cash on hand or in the business. Construction, renovation, and capital improvements can help you increase your commercial properties value and income generation. In addition, bridge financing can be an incredible short-term lending solution to propel you to the finish line.
Commercial Property Classes
- Senior Housing
- Storage Facility
- Student Housing
- Purpose-Built Property
- Commercial Unit & Building
- Industrial Unit & Building
- Condominium Construction
- Retirement & Nursing Home Facilities
- Automotive Dealership
- Recreational Resort
- Recreational-Vehicle Park
- Private Schools
- Condominium Conversion Project
- Commercial Plaza
- Health Canada Approved Cannabis Facility
- Places of Worship (Church, Temple, Mosque)
- Parking Lot
- Private School
- Storage Facilities
- Gas Station
- Medical Building
- Student Housing
- Golf Course
- Banquet Halls
- Apartment Buildings
- and more
The process is incredibly simple thanks to our online mortgage application that is always one-click away. Although this online mortgage application is primarily structured for residential mortgage applications, it captures most of the needed information for a commercial mortgage application. Keep in mind that commercial mortgage applications require in-depth information on the property type, tenants, the project, and the loan sponsors. In order to best prepare you for your commercial mortgage application, below is a list of supporting documents that might be required.
- A commercial real estate appraisal completed by an AACI designated appraiser and regulated by the AIC.
- Existing mortgage statements
- Confirmation of your deposits, down payment, and closing costs
- Most recent property tax statement
- Current rent roll and list of tenants
- Income and expense statements
- Financial statements
- Previous 2 years’ Notice of assessments (NOA) and income tax returns (T1)
- Phase 1 and potentially a Phase 2 environmental site assessment report
- Building condition assessment report
- Master business license or the articles of incorporation
- Information on other real estate and assets that you own, as well as liabilities
How Fast Can A Commercial Mortgage Be Funded?
Very fast! We uphold relationships with mortgage lenders that allow us to fund commercial mortgages at lightning speed. In fact, we have the ability to fund your commercial mortgage purchase in as little as 24 business hours on receipt of complete and satisfactory information and supporting documents.
At DV Capital Corporation we offer to you our knowledge, expertise, and extensive experience with commercial mortgages in Ontario. We invite you to contact us for a no-obligation assessment regardless of your income and credit profile. We look forward to learning more about you and your commercial mortgage dreams.