If you have recently received a Letter of Intent or a “Pre Approval” from a lender regarding a cash out refinance on your commercial property, you don’t need me to explain the pitfalls. Upfront appraisal fees (at $3000 – $5000), environmental fees ($2000), start off an often expensive and “brain numbing” process to fund your commercial loan.If you are seeking to pull cash out of your commercial property, there’s now a better way. The commercial equity loan also called a commercial real estate line of credit “sits” in second lien position behind any first mortgage that you already have in place. So, you potentially do not need to refinance your existing first commercial loan…This is especially true if your sole goal is to simply pull cash out of your property and you do not want to touch your existing loan. Perhaps your existing rate is better than market or you have a high prepayment penalty or you do not want to incur the closing costs associated with a new traditional loan, etc.In any case, the commercial equity line eliminates many negatives. For example, there are no upfront fees or upfront third party fees, like appraisal, title, or environmental. The bank essentially uses a comprehensive software program for these reports. For instance, the bank uses a computerized, broker opinion of value, rather than an appraisal to determine a commercial properties value.Closing costs consist of a 1% fee to the lender and an origination fee to the broker, paid out of the line, at closing. So, you could literally have no out of pocket cash into the loan. Also the prepayment penalties are virtually nonexistent at $1,500 in the first three years, compared to 5-10% of the outstanding loan balance on a typical commercial loan. Plus you only pay interest on what you borrow, rather than the alternative of cashing out a lump sum and paying interest on money you may not be using.However the commercial equity line is not perfect. Drawbacks include a relatively low loan amount, its capped at $500,000. Underwriting is strict with both the borrower credit scores (need to be above 660) and the Combined Loan to Value (Needs to be under 75%). In addition, although very common with lines, the loan is based off an adjustable rate, which is tied to Prime.All in all this is an excellent option, especially for owners that are seeking a way to unlock their commercial equity and not go through the expense and “brain damage” of a traditional commercial loan.
Commercial Equity Loan – An Alternative to Cash Out Refinance
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Custom Handmade Furniture For Your Interior Design Project Is A Fit
You know the process. Your shopping on the net, looking at countless furniture sites and you are unable to find the right furniture piece. You have a clear image of it in your head. If only someone can take a picture of your thoughts and custom design the furniture for you.Actually, there are a variety of ways to have that dream furniture piece created. Some furniture outlets want to have a detailed diagram while others will accept a drawing on a paper napkin and create a work of art better than you thought. You can even take a picture of an object and a furniture maker can easily duplicate the product for you.To my surprise, custom made wood furniture is no more expensive than buying a solid piece of furniture at your local retailer. Additionally, you get to pick out the wood, finishes, colors and fabrics, if necessary. Of course, designs that are more sophisticated or require intricate detail will be more expensive, but the end result will be worth it. You will have a unique custom made furniture item that will be the envy of those who see it.While any piece of furniture can be handmade, the following types are best for building handmade furniture:
Bar Stools – Custom bar stools can be created based on the height of your bar or counter top.
Beds – You can have custom beds and headboards made to fit your choice of mattress.
Kitchen Cabinets, Minibars and Wall Units – You can have custom cabinetry made with your choice of doors, fixtures and shelves.
Next, you select the wood, types of doors, number of shelves and fixtures with your choice of height and width for the perfect custom cabinetry. If you are going through the task of creating a custom piece of furniture, make sure you have the item fabricated of premium quality wood materials like mahogany, teak or acacia. Furniture made using high quality materials will provide you with many years of enjoyment.When choosing a furniture maker to build your furniture piece it is best to have a look at some of their previous work. If you are going to have a kitchen table built for instance, look at similar pieces to give you an idea of their work. Well established furniture makers are proud of their portfolio and references of their previous work. Also, make sure you understand how they want you to submit your design and get all costs quoted up front with estimated delivery times. Don’t forget to make sure they include estimated shipping charges and sales tax, if applicable, in their quotation.This will help avoid surprises when your furniture arrives. Also, find out if they are running any specials or have discounts like free shipping. Sometimes changing the material can lead to a price reduction without affecting the quality. A furniture designer takes great pride in their craft and wants you to be completely happy with the product. Now you can give your home or office the special look that is in your mind.