Alternatives to Traditional Bank Loans for Financing Commercial Construction Title Image

If you are planning a relocation or business expansion, finding the right commercial construction loan can ensure the success of your project. Banks and other traditional lending sources, however, may be less likely to approve many commercial construction loans since they deem them risky. This could lead to more stringent requirements to acquire the necessary funding for your construction plans. Looking into alternatives to the big banks can be a solid step toward success for your upcoming project.

Regional Banks

While commercial lending by the national banks may have slowed, regional banks are often picking up the slack for companies across California. These smaller financial entities can be more flexible in their lending arrangements and may be more open to a slightly higher degree of risk. When compared to the options available from larger scale banking institutions, this can lead to an improved chance of getting the funds you need.

Commercial Construction Loan Application at Regional Bank

Credit Unions

Requesting Commercial Construction Financing from Credit Union

If you qualify to join a credit union in  California or any other state, you can sometimes obtain favorable terms from these organizations. If you qualify, you’ll likely receive preferred treatment and a more personal approach to your commercial construction loan. You should note that not all credit unions offer commercial construction loans.

Alternative Lending Companies

Working with a company that specializes in alternatives to the traditional lending marketplace also known as “specialty finance lenders” can sometimes allow your business to acquire the funds needed for your commercial construction projects. This also includes funds for speculative home construction for developers and contractors.

Couple at Alternative Lending Company

ReProp and other specialty lenders will work with you to determine the following:

  • The amount of money you need to complete your project
  • The projected amount you will be required to pay monthly on your commercial mortgage loan
  • The most appropriate lending solutions for your company’s needs

You must determine that these lending companies have the expertise to fund and manage your commercial construction project.  Managing your project includes the timely inspection of work in progress and timely payment to contractors and subcontractors.


Documentation Requirements

Commercial Loan Documents

The documentation needed to qualify for a commercial construction loan may vary depending on the type of property and the type of loan. Critical to the commercial construction loan documentation is:

  • Your financial information
  • You and/or your contractor’s experience
  • Your ability to carry the project through completion
  • Your exit strategy.

Also, your lending company will usually conduct a credit check to ensure that you and your business is current on all its financial obligations.

By enlisting the help of a speciality finance lender, you can often enjoy a greater range of options and enhanced flexibility when financing your commercial construction project. This can help you manage your cash flow more efficiently while acquiring the funds needed to expand your business.

If you are looking for an alternative lending company to fund a commercial construction project in Washington, Idaho, Oregon, Nevada, California or Arizona, contact ReProp Financial where we fund loans direct and personally have commercial development experience! Call (800) 444-2948 for more information today!

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