If you are a business owner looking to grow and expand, you may find yourself in need of extra funding in order to purchase or expand new property. When this happens, you need a specific type of business loan: a commercial real estate loan. These loans are created specifically to give businesses the capital required to purchase, refinance, or renovate properties, unlocking opportunities for growth and long-term stability in Nashville’s competitive market. Read on to learn commercial loan basics, how to secure one for your business, and how US Community Credit Union can help you through every step.
US Community Credit Union is an outstanding choice for Tennessee businesses seeking reliable financing. Established in 1949 and deeply rooted in Nashville, our member-owned institution offers personalized service, competitive lending rates, and a streamlined approval process designed with Tennessee businesses in mind. Whether you need a commercial real estate loan, equipment financing, or other business loans, USCCU’s local expertise makes us the best partner for your business.
Commercial Real Estate Loans 101
Commercial real estate loans are designed for businesses investing in income-producing properties. Because the loan is secured by the property itself, lenders face less risk, which can help your business obtain favorable terms. The most commonly used commercial real estate loans are commercial mortgages and SBA-backed loans.
- Commercial Mortgages: These loans come directly from private lenders like banks and credit unions. Because they are not backed by the government, it is typically a simpler and faster application and approval process. It also allows for more flexibility in terms of variable interest fees, longer or shorter term lengths, and competitive rates.
- SBA-Backed Loans: These loans are supported by the government and are designed to support small businesses. This means that the application and approval process is much stricter. If approved, businesses can take advantage of their lengthy repayment terms and very attractive interest rates.
Choosing the right business loans can expand your opportunities and transform your expansion strategy. US Community Credit Union’s commercial real estate financing offers competitive rates, a fast and easy approval process, community-focused service, and flexible terms that are perfect for businesses in Middle Tennessee.
Steps to Secure A Commercial Real Estate Loan
When pursuing any business loans, preparation is key. Be ready by taking these steps:
- Assess Your Needs: Determine how much money you need and the purpose of the loan, whether it be for a property purchase, renovation, or refinancing.
- Prepare a Strong Application: Compile financial statements, tax returns, business plans, and property assets. Include accurate documentation to show lenders your ability to repay the loan.
- Consult with US Community Credit Union: Submit your application at US Community Credit Union and schedule a meeting to discuss loan options, terms, and rates. Keep track of repayment schedules, and do not accept loan terms that you cannot repay.
- Evaluate Collateral and LTV: It is important to understand your future property’s value and your loan-to-value ratio. When discussing with a financial advisor from USCCU, we can help you determine your LTV and provide tools to accurately appraise the property.
- Underwriting, Approval, and Closing: Our underwriting process occurs in-house, often approving faster than large banks. Once you are satisfied with your terms, simply sign your loan documents and begin your expansion in Nashville!
Need more guidance? Call US Community Credit Union at (615) 256-8712 to discuss how to prepare your commercial loan application today.
Guaranteeing Approval
Understanding the qualifying criteria for business loans will help you prepare a strong application and increase your chances of approval. Lenders consider these key factors:
- Creditworthiness: Lenders assess credit scores and payment history to gauge risk.
- Loan-to-Value (LTV) Ratio: Most lenders require collateral covering a portion of the property’s value. Some may even require the real estate itself as collateral.
- Debt Service Coverage Ratio (DSCR): Lenders review statements to see if potential borrowers demonstrate sufficient cash flow to cover loan payments.
- Detailed Documentation: Having a comprehensive business plan, detailed financial statements, and accurate property appraisals streamlines underwriting.
Choose US Community Credit Union for Your Business Loans
US Community Credit Union offers distinct opportunities and advantages for Nashville businesses looking to expand. Since 1949, we have helped the Nashville community grow with our tailored financial services and non-profit structure. Our structure as a member-owned institution allows for competitive rates and more flexible terms, perfect for Nashville entrepreneurs in need of critical financing. Partner with USCCU to experience exceptional banking services, dedicated support, and local expertise designed to lead your business to long-term success.
Ready to expand your footprint in Nashville? Partner with US Community Credit Union to explore commercial real estate and business loans that drive growth. Visit our website or call us at (615) 256-8712 for more information.