I finally found a piece of commercial prop to locate my biz, and stop paying rent! My agent mentioned SBA loan programs but I don't know much about them.
I want to weigh the options between having the business buy it, or buy it myself and rent it to my business.....
Any experience out there?
Mandy, the last time we had take out one (late 70's), they were about the only ones who would loan us the amount we needed, but the restrictions and the reporting were not worth the effort after a few years.
Have you tried conventional first? A lot less restrictive and might be worth a look
Scream
You will have to put damn near every asset you have against the loan. if things go bad, the SBA is pretty hard on you. As far as you or the biz buying, i guess it depends on your situation. either way isn't bad. i wanted to buy it personally and rent it back to my biz but i guess it may boil down to which is more credit worthy and what your goals are.
Mandelon,
If you're not incorporated, that should be high on your list. You can buy the property yourself and lease it to the company for the same amount as the payments, this will keep Mandelon flush with cash flow and will give you all of the equity without the tax burden (not considered income, the company buys you a building).
When your done chasing mold, you can sell the business and keep the building. Oh yea, that's the way to do it...
Scream
Mandelon, If your lender requires an ALTA Survey for the property let me know. I'll hook you up. That's our specialty over here.
Start reading...
http://www.sba.gov/
Mandy, The positive on the SBA is that it requires less of a down payment 10% vs. 20% conventional. Also you have a longer term, either 15 or 20 years.
The negative is it is more expensive in fee's than a conventional loan.
Talk to whoevere you bank with. They can be very helpful.
If the time comes and you go SBA, shop it around, you would be suprised by the difference in cost's.
As far as buying it, I am going through that right now. We formed a LLC to buy the building, then lease it to the business for whatever makes sense. Not sure all the reasons as to why, Just what our CPA told us is the way to do it, and this guy knows more than everyone put together.
Mandelon:
Give me a call and I'll give you some infor. I do Commercial Lending, conventional and SBA. I am not a broker, I work for a bank.
Matt
626.914.7390
I underwrite commercial and sometimes SBA when we are backed up. Two types of SBA loans that we do, 504's and 7A. To get the SBA loan you are going to have to occupy at least 51% of the building. SBA will typically require to take a 2nd out on your home as collateral. Fees are set by the SBA and are on a tier basis. IM me for more info.
Mandelon:
Give me a call and I'll give you some infor. I do Commercial Lending, conventional and SBA. I am not a broker, I work for a bank.
Matt
626.914.7390
What Bank you work for? Are you at FIB?
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