uneral homes, assisted finding another owner for a
living facilities, unique commercial property should
campgrounds and other it be necessary due to a loan
special purpose properties default.
represent one of the most
difficult commercial loan (2) For funeral homes and many
situations which will be other special purpose commercial
confronted by a business owner. properties, most of the business
Unique properties are not easily value is represented by non-real
understood by traditional estate assets. With commercial
lenders, so the most common lenders that focus on commercial
solution involves finding a real estate loans, it is almost
non-traditional lender for impossible to get a loan based on
funeral home financing as well as the real estate value AND the
commercial financing for other business value. For example, it
special purpose properties. Such is not uncommon to have a
non-traditional lenders will be situation in which the real
appropriate for purchase estate for a funeral home is
situations as well as refinancing valued at less than one million
and new construction. dollars while the overall
business value is in excess of
KEY REASONS FOR DIFFICULTY IN three million dollars.
ARRANGING COMMERCIAL FINANCING
FOR SPECIAL PURPOSE PROPERTIES (3) Because commercial financing
is so difficult to arrange for
(1) By definition special purpose special purpose properties such
properties are not similar to as funeral homes, assisted living
other commercial properties. This facilities and campgrounds,
makes many lenders uncomfortable sellers of such properties are
due to the likely difficulty of generally willing to provide
substantial seller financing to
assist the buyer in acquiring the For a business borrower facing
business. However, many the situation described above,
traditional lenders do not the highest priority should be to
recognize or accept seller locate a non-traditional
financing as a means of reducing commercial lender that engages in
down payment requirements for the following commercial loan
special purpose properties. practices:
(4) Many lenders simply do not (1) Openly welcomes special
understand the business purpose properties and routinely
complexities associated with a finances such properties.
special purpose property. As a
result, it is not uncommon for (2) Provides commercial financing
these lenders to attach onerous for both the business and real
and expensive requirements such estate.
as business plans and
environmental reviews. In most (3) Accepts substantial seller
cases such lenders do not even financing.
want to make the business loan
but will use undesirable loan (4) Does not add special
requirements as a means of requirements to the business loan
appearing to approve a loan when for special purpose commercial
in fact they have disapproved the properties.
loan by adding commercial loan
terms that they do not expect a (5) Has a history of making loans
commercial borrower to accept. for the specific type of property
under consideration.
COMMERCIAL LOAN SOLUTIONS FOR
SPECIAL PURPOSE PROPERTIES (6) Can accommodate both small
and large commercial loans for http://steve.bush.googlepages.com
special purpose commercial /reports or
properties (for example, loans as http://aexcommercialfinancing.com
small as $100,000 and loans as /_wsn/page5.html to enroll for
large as $5 million or higher) the six special reports.
A series of special commercial Copyright 2005-2006 AEX
financing reports relevant to all Commercial Financing Group, LLC.
of the problems described in this All Rights Reserved.
article is available online free
of charge. Please visit
About the Author:
Steve Bush provides commercial financing assistance throughout the United States and focuses on more difficult commercial loans. He is the Chief Executive Officer of AEX Commercial Financing Group, LLC in Ohio. Contact: (888) 593-3951.
Read more articles by:
Stephen Bush
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