Rates have fallen so much over the past year and a half that virtually every owner of commercial property should consider refinancing.  The opportunities to increase your monthly cash flow and speed up your principal pay down are remarkable.  Do not miss this tremendous opportunity.

Many owners today have refinanced their buildings and taken cash out to purchase other properties.  In some cases, our clients have even reduced their loan payments while taking cash out.  Cash refinanced out of a property is tax free money in your pocket.  Consult your tax advisor for full details.

Where Do You Start?

The first step is to determine if you have a prepayment penalty on your loan.  Your promissory note should make this clear.  If you are not sure, fax your note to us or call your lender.  If you do have a prepayment penalty, we may be able to calculate it for you, or you may have to ask your lender.

When Does It Make Sense to Refinance? 

Simply put, if the benefit of getting the new loan outweighs the cost of that loan, you should refinance.  The decision is probably easy if you do not want to take cash out, but just want to improve your rate.  We can lay out a side-by-side comparison of your current loan compared to a new loan.  It will show how much you will spend on each loan over the next five and ten years.

If you want to take cash out, the decision to refinance is more subjective.  You will have to decide how valuable the cash out will be.  What will it become if you invest it in another property or in your business?  What is the interest rate on the debt you will pay off?  How much personal pleasure you will get out of the new house, new boat or watching your child at a college graduation?

What Kind of Loans are Available?

Simply put, most commercial property loans fall into one of two categories:

Owner Occupied Loans

Income Property Loans