Stated Income Commercial Real Estate
Understanding the Benefits of Stated Income Commercial Real Estate Loan
Every real estate investor knows that the person with access to money usually wins the property. Commercial real estate is an incredibly competitive market.
While traditional loan options are beneficial in specific situations, a stated income commercial real estate is more so in a highly competitive marketplace. Some programs offer a stated income program that not only provides quicker approvals than traditional loans from conventional lenders but it is also more accessible for people of varying credit profiles.
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The Differences Between Traditional and Stated Income Loans
Conventional lenders place a high value on the creditworthiness and financial history of the applicant. While this approach is not particularly wrong, it bogs down the approval process with reams of paperwork and time-consuming checks and balances between departments.
Programs understand the value of time, so they try to approve stated income loans in days, not weeks. Also, a stated income loan focuses on the value of the property in question, not so much on the borrower. They are satisfied as long as you have a credit score of 600 or better and the property in question contains enough value to cover essential loan-related costs.
The Primary Benefits of a Stated Income Loan
Every loan has its pros and cons, but finding anything negative with the stated income loan is challenging. Some programs offer the following:
- Up to 25-year terms with fixed rates
- Funds used for various purposes
- Loan caps up to $500,000
- LTV up to 75% depending on property type