How to make your commercial property financing go more smoothly:

We're all aware of the "time value of money". Well we should also compare the strategic value of a simple action taken at the right time vs. the value of the same action taken too late in the game. The difference can (and usually does) amount to an easy task that has now been transformed into a pressure-cooker, error-prone, last minute nightmare. Whenever possible, use the idle time between accepting a lender's offer and receiving the commitment to your best advantage, clearing as many obstacles out of the way as possible.

Anticipate the Obvious!

While no one can ever anticipate every possible contingency or problem that might arise during the financing process, it's fairly simple to anticipate a number of routine occurrences and requirements, and to sweep as many of them out the way as early in the process as possible.

If you are seeking a mortgage, please be prepared to present all information related to your business especially your financials.  Financial statements and tax returns going at least three to five years back are pretty much standard.  If you do not have these ready, it usually a very prudent decision to have yourself and/or your accountant prepare them. 

While simply giving all your information to a potential lender unpolished and not presented in the best light is not a good idea, when working with your mortgage finance broker this is precisely what you should do.  For example, if you aren’t sure if your broker needs that sketch of your factory, send it anyway.  We much rather say “Oh, we don’t need to include this,” rather than waiting two weeks for you to get it to us later.

After you have accepted an offer from a lender and you're waiting for the commitment to be issued, it's usually a good idea to pull the trigger and order the title searches. Most real estate attorneys can order the title work from a company that they regularly use which is willing to assume the risk that if the deal does not close, there will be no fees for the searches.

Since title work is still one of the more primitive and time-consuming parts of the process, the earlier you start, the better. That way there will be plenty of time to deal with delays and to resolve pesky violations or other issues that may arise before the stress-laden pre-closing days arrive.

With regard to the survey, at the very least, make sure you're aware of the new lender's requirements. For example, if your new lender will require an ALTA survey, and the old survey was not prepared to those specifications, order it once you've accepted an offer rather than waiting for the commitment as the survey could easily take 4 - 6 weeks. Many surveyors are currently quite busy and not famous for quick turnaround, so by all means don't leave this until the end.

By remember these tips and suggestions, you can make sure that you receive financing sooner rather than later (or worse not at all).