Is a Stated Income Commercial Real Estate Loan Right for Your Business?
Here at Integrity Financial Capital, we strive to connect clients with potential financial solutions to their specific circumstances. If you are a business owner with less than perfect credit or merely looking for a more simplified loan application process and you have a commercial property capable of servicing the anticipated debt, then a stated income commercial loan may be right for you.
What is a Stated Income Loan?
While traditional loans require significant inquiries into the finances of the borrower, a stated income loan focuses more on the value of the property and its ability to cover the loan costs – mortgage, insurance and taxes – and repayment. As qualifications are focused more on property value and less on the credit history of the borrower, the approval process of a stated income commercial real estate loan can be quicker than other traditional loans, and this is true for any industry or small business niche. However, it is important to note that while credit history is not the focus of application approval, this type of loan does require a qualifying credit score of at least 600 and the provision of employment documentation – W-2 or 1099 forms.
What are the Benefits of a Stated Income Loan?
While loan limits vary depending on property size and value, there are many benefits to pursuing this type of loan for your business.
- Funds can be used as working capital or for purchasing, debt consolidation or refinancing
- $500,000 loan cap
- Warehouse type properties can receive up to 65 percent LTV
- Investment properties may receive up to 70 percent LTV
- Multifamily and mixed-use properties can receive up to 75 percent LTV
Be aware that loans on multifamily and mixed-use properties may require a qualifying credit score of at least 700.
If you require a business loan, and your credit history has been a hurdle to approval in the past, then a stated income loan may be a great solution. Contact one of our representatives today to discuss all your financial options and the finer details of a stated income loan.