Low Rates: Always the Most Important Feature?

No.

Why? Even though there are arguments lenders could give you that you should go with them because they are quoting you a low rate at the inception of the loan process – the low rate quite possibly is deceptive.

A lender can quote you anything they want to quote you at the beginning of the loan process. Because you are not trained in commercial loans, whatever they quote you, you very well could believe.

Let’s say for example that they quote you 4.25% for a 10 year fixed rate, 30 year amortized apartment loan purchase, but the problem is, at that rate they wouldn’t make enough money to keep the doors open. Around 4.70% is the going rate for this type of loan with your situation. But, you don’t know the difference. The lender’s rate is well below a real loan rate. You decide to go with this lender with the false lower rate.

Two months into the loan process, you get a call and the loan officer you are working with tells you that loan rates have gone up – your loan rate will be not 4.25%, but will be 4.72%. Even though you are upset because you are going to pay many thousands of dollars more per year for the loan, you accept the bad news. Your loan is 3 weeks away from closing and there is a purchase contract deadline.

At signing you end up with the property, somewhat unhappy because you are paying so much more than you were originally quoted. And you did not know that you were deceived by an unscrupulous lender.

Keep in mind that loan rates fluctuate. Thus, you need to allow for changes in loan rates in the process of acquiring your commercial property.

We have an A+ Better Business Rating at ApartmentLoanStore.com and Business Loan Store. This is because we quote fairly and have other good habits of honest business practice.

Contact us to see if you qualify for our best multifamily, commercial, or bridge loan rates and terms. Keep in mind that one of our specialties is commercial bridge lending. Also, contact us if you would like to discuss your particular commercial lending needs, or if you have questions. Call 214-695-7310 or send an email to info@apartmentloanstore.com

To discover more about our loan products as well as rates and terms, see our loan programs page.

Bruce Painter, Director of Marketing, Business Loan Store