(Ken Markizon is the business development manager for APEX Mortgage Corp. He has worked in commercial loans for close to 15 years at a variety of direct lenders. Email Ken at kmarkizon@ apexmtg.com.)
You are meeting with a client. You get to the third page of the loan application and find out that your client owns a small, commercial building. By the way, they ask if you can finance the building for them at the same time you are doing their loan.
Most loan officers would say, "NO" and then refer the client to the local bank. The problem is that the local bank does not want to touch a commercial loan under $500,000 and your client’s building is worth about $200,000.
There are sources for small, commercial loans and it is easy to make some extra money with this niche market. In fact, we even provide you with a sample letter you can use with CPA’s, Financial Planners and Attorneys to generate business!
The old saying goes, "Many streams make a river." So it is in the mortgage business. Look at small commercial lending as one of those "income streams."
How can you make money in small commercial mortgages?
Normally, small commercial mortgage brokers charge between 2.5 and 3.5 points however, there are occasions when 4 or 5 points are justified. On a $250,000 commercial mortgage, a reasonable fee would be $7,500 fee. Small commercial mortgages can be closed in as little as 30 days from the time of application.
Why should you invest a little time in pursuing small commercial loans?
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