Credit Unions

Credit Unions are often overlooked as lending sources for commercial real estate financing. While they once specialized in offering car loans, residential mortgages, and personal loans, credit unions are now carving out a significant piece of commercial real estate lending. As they are not-for-profit organizations owned by the customers (known as members), they tend to be most aggressive in terms of interest rates offered, as the yields they seek are generally not required to be as large as banks or other sources seek.

Loan-to-Value Ratios

In comparison to historical lending ability limits, they are now able to offer larger loans as their capital pool increases through mergers of smaller credit unions into larger ones; however, their loan amounts may still be lower than what other lenders can offer. Additionally, credit unions are able to offer loan-to-value ratios of up to 80%, and typically do not require prepayment penalties (a significant advantage that can be difficult to find with other lending sources).

Benefits

  • Up to 80% loan-to-value available, generally without a prepayment penalty
  • Relatively new to the commercial real estate mortgage arena, so it will be advantageous to work with an experienced loan originator at Venture Mortgage to facilitate the process