7 Questions To Ask a Commercial Mortgage Broker (Or Consultant)
Over 600,000 new businesses open in the U.S. each year. Millions more are always looking to expand.
When figuring out how to expand business or perhaps start a new one, the property is a big concern. Where do I go to find the right property? Who do I turn to for acquiring the funds?
That’s where a commercial mortgage broker comes in. While banks and other financers are important, these brokers can help you navigate the process much smoother.
In this article, we’ll be going over what commercial mortgage brokers are and what questions you should ask when hiring one for your own needs. Read on to find out more!
What is a Commercial Mortgage Broker?
A mortgage broker is essentially an intermediary between someone who wants to purchase real estate or some sort of property and the financial institution that offers loans. If you’re starting a new business or looking to expand, you’re most likely going to take out a few loans to do so.
These institutions can offer loans that are secured with real estate, but many are apprehensive or aren’t fully equipped to handling conversations about loans on their own. That’s where commercial mortgage brokers come in.
They’re experts at identifying lenders and tailoring them to your specific commercial needs. By serving the middle ground, commercial mortgage brokers keep both sides happy.
But what exactly does a commercial mortgage broker do? What are some specific tasks they can do on your behalf?
What Does a Commercial Mortgage Consultant Do?
Commercial mortgage consultants try to complete any transactions as a third-party intermediary. They collect information about your business and go to different lenders to find the right ones for your needs.
They essentially tailor your loan options based on your information. They’ll work with both you and the financial institution to make sure you can get approved for a loan.
Brokers are completely focused on making sure loans can close. They’re instrumental in getting all the right paperwork in order to make loans happen.
Why Use a Commerical Mortgage Broker?
Now that we know what commercial mortgage brokers do, it’s time to go over why you need them in the first place. You might be asking: “Can’t I figure out my own finances and do all the paperwork myself?”
The truth is that commercial mortgage brokers offer more benefits than just their services entail. For starters, identifying the right loan by yourself is harder than it might seem.
Finding a lender that suits all your loan types, property needs, or other special circumstances can get time-consuming if you go at it by yourself. Mortgage brokers are experts at streamlining this process on your behalf.
If you search for loans by yourself, chances are you’ll only have time to find one or two potential lenders. While this might work out in the end, you’re putting all your eggs into a single basket.
With a commercial mortgage broker, you’ll be sending out applications to multiple lenders. This increases the chances of you securing a loan while also providing a safety net in case one lender falls through.
Commercial mortgage brokers also help you save considerable money since they know the ins and outs of loan fees. They’ll find the best possible option based on your budget.
7 Questions to Ask Commercial Mortgage Broker
Now that you know why commercial mortgage brokers are so valuable for those starting or expanding businesses, it’s time to look for candidates. But before you hire one willy nilly, it’s important to tailor your search to get the right broker for the job.
Here are 7 questions you can ask potential suitors that’ll ensure you’re finding the best possible candidates:
1. How Many Years of Experience Do You Have?
While there are thousands of experienced brokers out there, be wary of those who are just starting out. These brokers might be working through a network, meaning they don’t work directly with any lenders.
Make sure you ask about their years of experience to understand how reliable they are in getting your mortgage loans completed efficiently and effectively.
2. Do You Have a Resume or Bio I Can Review?
Just asking about years of experience isn’t enough. Get a look at their resume and body of work to see whether their expertise matches your needs.
3. Can You Give Me Any References For Your Work?
Knowing how well your brokers are respected in their communities or former clientele can be extremely valuable. Get references and ask around to ensure you’re getting the best possible services.
4. How Many Lenders Do You Work With?
If a commercial mortgage lender works with a wide array of lenders, your chances of finding the optimal situation improves. This is why you should ask your brokers about the size of their network.
5. What Are All of Your Fees?
This is a crucial question that you should tackle early on. Understanding how much you’ll pay for a broker’s services and what they go towards is crucial when budgeting.
6. What Size Loans Do You Typically Do?
Not all brokers are experienced in or deal with the same size loans. If you want a relatively bigger loan, a broker who’s mostly dealt with smaller commercial mortgages might be out of their element. Asking this question early on will surely save you time and effort.
7. What’s the Time Frame For Closing After the Appraisal is Ordered?
Typically, loans take anywhere between 45 to 60 days to close after the appraisal is ordered. Time is money, and the better idea you have of getting your mortgage approved, the smoother everything goes.
Leverage Commercial Mortgage Consultants Today
A commercial mortgage consultant is a crucial asset when you’re building or expanding your business. Use this guide to know exactly what to ask a broker/consultant when you’re hiring.
Need expert advice on business financing and growth? Contact us today and we’ll get you started on a solution right away!