Mortgage agents and brokers in Canada have
a vast opportunity in the area of commercial mortgage financing. Arranging
commercial deals is highly profitable and it is a segment of the market that is
much less competitive than residential mortgage financing. The reason it is
less competitive is that many mortgage agents and brokers want to be able to
offer commercial mortgage financing but don't know how. This is why having a
strong partnership with a commercial mortgage lender is key.
Arranging commercial mortgages and seeing
them through to funding will ultimately come down to the support offered by
your commercial mortgage lender. Many major banks that offer commercial
mortgage financing do not offer mortgage agents and brokers this support.
Instead, they expect the mortgage agent or broker to know how to put together a
commercial deal. This is a major reason why, despite interest, many mortgage
agents and brokers shy away from commercial mortgages.
Like anything, getting up to speed on how
to arrange a commercial mortgage will come down to practice, experience and, as
I mentioned, a strong partnership with a commercial mortgage lender that will
support you through the learning curve.
So what should you expect from a commercial
mortgage lender?
Availability and Responsiveness - Your commercial
mortgage lender should be available to take your calls and/or returns your
calls within 24 hours. They should respond to your emails the same day and be
available to discuss and offer a quote to you if you have provided them with
the key information. If information is missing, they should help you to
identify missing information so that your next quote runs even more smoothly.
Assistance and Education - Because most
residential mortgage agents and brokers have little knowledge regarding
commercial mortgage lending, they will often need help from start to finish. A
good commercial lender, and particularly a good private commercial lender, will
recognize this and provide required patience, direction and support.
A good commercial mortgage lender will
provide you with a term sheet or conditional commitment within 24 - 48 hours of
receipt of a proper package for underwriting and consideration of the transaction.
They should also offer financing on a wide range of property types.A big part of getting deals done is problem solving. Your commercial mortgage lender should be a deal maker and always be looking for ways to make your deal work. This may include, but not be limited to, the way the deal is structured, the interest rate, outside security, and alternative debt service or interest reserves.
If your commercial mortgage lender is a private lender, they should provide you with access to a decision maker or, if the commercial mortgage lender is an institutional lender, they should have a proven track record of getting results.
As we all know, the mortgage industry is
very competitive and the more you diversify your ability to finance different
types of mortgages, the more competitive you will be. Forging a strong
partnership with a good commercial mortgage lender will help you achieve this
goal.
If you are interested in learning more about
commercial mortgage financing, or you are a commercial mortgage broker or agent
already and would like more information about our programs, please contact
Commercial Mortgage Team at First Equity at 416-440-1224 ext 22 or visit www.firstequity.ca
