Let’s work together to find a solution
Rely on AVANA Capital to help preserve your wealth and create growth for your business.
Securing a loan for an ambitious commercial real estate project takes time, effort, and expertise. Borrowers must carefully consider their lending options before they embark upon this process if they want a project to succeed. More often than not, securing a credit union commercial real estate loan is the ideal option for borrowers looking to finance their next big development.
Credit unions provide unparalleled expertise and timely lending options for borrowers who must meet tight developmental deadlines. Becoming familiar with the ins and outs of real estate loans issued by credit unions and other institutions is the first step toward securing financial security for a budding project’s financial security.
There are many legitimate sources of lending that should be considered when developers are seeking a commercial real estate loan, but some are far superior to others. Credit unions offer competitive interest rates when it comes to securing credit union commercial real estate loans. A credit union has no shareholders, guaranteeing that its membership comes first when it comes to lending operations. Given a credit union’s unique focus on serving a local geographic area, it may also provide better services than competing lending services for developers in a specific region.
Savvy borrowers will benefit from the prepayment flexibility offered by credit unions that traditional banks may be unable to compete with. Commercial real estate developers operating in up-and-coming markets may find local credit unions far more willing to provide lending services than private debt funds that are unwilling to tolerate many risks. Credit union commercial real estate loans are thus more attainable for local developers willing to embark upon risky ventures that may prove to be immensely profitable in the long run.
Private debt funds are an alternative lending option for developers to consider. According to a National Association of Realtors report, private equity accounted for approximately 55 percent of capital in the commercial real estate market. Private debt funds may be willing to dispense large sums of capital to ambitious real estate developers, though they may also institute prepayment restrictions to ensure their own profits. Borrowers who seek to settle their debts before their private loan’s maturity date may be forced to deal with exit penalties imposed by the lender.
Traditional bank loans may offer commercial real estate developers some of the lowest interest rates available. These loans are often long term, making them ideal for developers of large projects which may take many years to complete or face the risk of unexpected setbacks. Nevertheless, these loans may be harder to obtain for developers with a limited credit history or an unwillingness to undergo an extensive vetting process conducted by the bank. Newcomers to the commercial real estate market with limited experience in the industry may struggle to secure a traditional bank loan. Therefore, developers must carefully review how to decide whether it is time to take out a loan.
Traditional bank loans, private debt funds, and credit union commercial real estate loans can all help developers enhance their projects’ scope. Finding the right option for a unique commercial real estate project is easier with the help of experts at Extensia Financial. With average loan sizes ranging from $2-15 million, Extensia can provide competitive rates to ambitious developers ready to begin their next big project.
Locally focused developers can work with Extensia to secure funding from a credit union lender that is invested in the wellbeing and growth of the nearby community. Contact Extensia today to begin forging a financial relationship with an exceptional lending partner with a history of success.