A Guide To Getting a Secured Business Loan
October 8, 2009 by Stacy42
Secured business loans or commercial loans are designed for a wide variety of small, medium and startup business needs including the purchase, refinance or growth of a company. Business loans are similar to a commercial mortgage in that funds can be borrowed over an extended period of time, usually a maximum of 25 years, and are secured on the building being purchased.
A business loan can be secured against most types of freehold or long leasehold properties, such as factories, shops, bars, residential care homes, guest houses, restaurants, office buildings, industrial units, blocks of flats and more. A business loan can also be secured against a residential property. The lending criteria is very similar to that of a commercial mortgage except that the general maximum that can be borrowed is 60% of the assessed Market Value. However, a few lenders will advance up to 75% depending upon the deal and the security available. Interest rates on the business loan are variable and depend upon the credit history of the borrower and the length of the term.
These percentages are known as the Loan-to-Value ratio, or LTV. The lower the LTV, the lower the risk is to the lender. The higher the LTV, the more the risk to the lender and it is probable that a higher interest rate would be levied. Lenders will not usually advance above 75% LTV to try to make sure that there would be enough security in the case of a quick sale, often via an auction house when it is expected that property will sell at a discounted rate of up to 25% below the regular market value.
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First, I think you have some terms confused. LTV means Loan-to-Value. Every loan has an LTV. I think you mean to ask about an equity loan.
If I understand you correctly, you are buying a house appraised for $56k for only $20k, which you will get by liquidating a mutual fund. So what you want to know is, can you qualify for a home equity loan to finance some repairs.
Qualifying for a home equity loan is like any other mortgage. You would qualify based on your income, credit history, employment history, equity, assets, and reserves. Assuming everything else is in order, you have good equity (100%) but your biggest problem will be inconsistent employment history.
Talk to a few lenders. It doesn't cost anything to have them qualify you (if they do try to charge an "application fee" hang up). I recommend Julie at
Good luck.
#discount #mortgage best buy: #HSBC Bank plc Discount 1.99% (60% LTV) -
#mortgage #bestbuys Discount 2.55 [60% LTV] – #ING Direct
#mortgage #bestbuys 5 year fixed 4.49 [60% LTV] – #Britannia
While it's true that a few pay-option ARMs are as you describe, I think it was less than 5% of them.
The vast majority started out as 70% or 75% LTV.
The California bubble in particular was fueled by people with high FICO scores who had some cash from their prior home to put as down payments, and then a lot of them got “piggyback seconds” so they only really paid 10% down.
That 10% disappeared in the first round of price declines, and of course, in the negative amortization. Most of the forced recasting of option ARMs was due to hard limits on how far they could negam, typically to 115% of original balance. It was not actually tied to the overall LTV. The 70% LTV loans basically grew to 115% of their balance, which is not so coincindentally right around 80% “original” LTV.
If the houses had held their value, the loans probably could have survived. That was certainly true for the remarkable 25 year run of World Savings (Golden West) as the specialists in these loans. Herb and Marian Sandler took out over $2 billion in cash when First Union (later Wachovia, and later still Wells Fargo) bought them out and ended up with well over $100 billion in pay-option ARMs.