Commercial loans are bank loans that are granted to different types of business entities. Commercial loans are usually for a short-term (from 30 days to 1 year) and are often advanced for financing equipment, machinery, or inventory. In some cases, the loan is extended to assist a company with short term funding for basic operational functions. It may be used to purchase new machinery that is directly connected to the operation of the business.
This type of loan is often employed when a company needs funds to secure resources to handle large orders from customers while still providing operations to other clients. Banks usually require the commercial borrowers to submit monthly and annual financial statements, and to maintain insurance cover on the financed item. The business must present the documents to show a stable cash flow in order to avail a commercial loan.
A Construction Loan is a mortgage loan that funds the building of a new home or residence. The construction loan is closed for the total loan amount, and the funds are paid out over a period of time once the project gets completed. Funds are taken through a process called draw.
A land mortgage is a type of mortgage loan that is used to purchase land. Buyers of raw land usually purchase it with the intent of developing it .These mortgages schemes are different because from a bank's point of vieew as land is a less secure investment. If someone becomes a defaulter, the bank will be left with an empty lot that could be difficult to resell.
A commercial loan for an apartment building is one of the easiest mortgage loans to get because commercial lenders targets primarily on the subject property since the repayment source with the borrower is a secondary repayment source.
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