When should I refinance?

It is often said that you should refinance when mortgage rates are 2% lower than the rate you currently have on your loan.  However, refinancing may be a viable option even if the interest rate difference is substantially less than 2%.  A modest reduction in the loan rate can still trim your monthly payment.  For example, the monthly payment (excluding taxes & insurance) would be about $6,321 on a $1,000,000 loan at 6.50%.  Lowering your rate to 4.50% would change the monthly payment to approximately $5,067.  This is a monthly savings of $1,254.  The significance of such savings in any scenario will depend on your income, budget, loan amount and the change in interest rate.  Your trusted lender can help calculate the different scenarios.

Should I refinance if I plan on keeping the property only a short period of time?

Well, that depends on numerous factors.  Most lenders will charge fees to refinance a loan.  It is a good idea to determine how long you plan to stay in the property.  If for less than two years, your monthly savings may not have the opportunity to accumulate and recoup these costs.  Let’s say a lender charged $10,000 to refinance your loan, but it resulted in a monthly savings of $500.  It would take 20 months (10,000 divided 500) to recoup the initial costs before you start to realize some savings.  Some lenders will charge a slightly higher than average interest rate on refinance loans.  But they may waive all costs associated with the loan.  The attractiveness of these loans will depend on the interest rate you are being charged on your current loan.

How much will it cost me to refinance?

There are other fees in addition to a commercial loan application deposit of $2,500 to $5,000, or more for larger loans.  You will likely have to pay an origination fee (typically 1% to 2% of the loan amount).  In many cases you will have to pay much of the same costs that you had to pay with your current commercial mortgage.  These include title search, title insurance, misc. lender fees, etc.  The sum of these fees could cost you up to 2% to 3% of the loan amount.  If don’t have the money to pay for associated loan closing costs, you may wish to explore “no-cost” loans.  These loans will charge a slightly higher interest rate.  So ask a lender if it would still make sense to refinance using this type of program.

What are points?

You need to pay points to a lender in order to receive mortgage financing under specified terms.  The cost of a point is a percentage of the loan amount (one point = one percent of the loan).  One point on a $1,000,000 loan is $10,000.  Discount points are fees that are used to lower the interest rate on a mortgage loan.  You are discounting the interest rate by paying some of this interest up-front.  Lenders may express other loan-related fees in terms of points.  Some lenders may express their costs in terms of basis points (hundredths of a percent).  100 basis points = 1 point, or one percent (1%) of the loan amount.

Should I pay points to lower my interest rate?

If you plan on owning the commercial property for at least a few years, paying discount points to lower the loan’s interest rate can be a good way to lower your required monthly loan payment (and possibly increase the loan amount that you can afford to borrow).  If you only plan to stay in the property for a year or two, your monthly savings may not be enough to recoup the cost of the discount points that you paid up-front.  Ask your mortgage professional how long it would take for your monthly savings to recoup the costs of the discount points.  This is known as a “Payback Period.”

Should I lock my loan rate?

No one knows for sure how interest rates will move at any given time, but your lender may be able to give you an estimate of where it thinks mortgage rates are headed.  If interest rates are expected to be volatile in the near future, you may want to consider locking your interest rate if rising rates will no longer allow you to qualify for the loan.  If your budget can handle a higher loan payment or if the lender’s lock fee seems excessive for your means, you might want to consider allowing the interest rate to ‘float’ until the loan closing.

I’ve had credit problems in the past, does this impact my chances of getting a commercial loan?

Obtaining a commercial property loan is still possible even with less than stellar credit.  If you have had credit problems in the past, a lender will consider you to be a risky borrower.  To compensate for this added risk, the lender will charge you a higher interest rate and usually expect you to pay a higher down payment on your commercial property purchase (typically 20-50% down).  The worse your credit is, the more you can expect to pay for an interest rate and the larger the down payment which will be required.  Not all lenders choose to lend to risky borrowers, so your mortgage professional will be extremely helpful in this regard.

I’ve been late a couple of times on my credit card bills.  Does this mean I will have to pay a higher interest rate?

Not necessarily.  If you have been late less than three times in the past year, and the payments were no more than 30 days late, you probably have a pretty good chance at getting a commercial property loan at a competitive interest rate.  Lenders guidelines will vary, but most lenders will excuse a couple of minor “late-pays.”  This assumes that the borrower can provide a reasonable excuse when explaining them (i.e. job transition, illness).  If the late-pays were 60+ days late and cannot be explained, you may have to settle for a higher interest rate.  Of course, the higher your credit score, the more smoothly the entire commercial loan process will go!

How can if find the best deal?

When comparison shopping among mortgage professionals, remember that a lender can structure financing for a borrower several different ways.  A lender can charge higher fees and offer a low-interest rate.  While another may charge a slightly higher interest rate with lower fees.  In order to make an “apples to apples” comparison between lenders, ask each lender what their interest rate is for a zero-discount point loan (based on a 30- or 60-day lock period).  Then ask each lender what they charge for an origination fee.  And ask them about any other fees they typically charge for a loan, (i.e. broker, processing, underwriting).  A reputable lender will not hesitate in answering these questions.

Should I choose the lender with the lowest interest rate and costs?

You should consider the primary two things to when choosing one mortgage professional over another.  Consider the quality of service being provided and the cost of services provided.  Quality of service is especially important to those who have never purchased a commercial property.  Or they do not have the detailed expertise it takes to fund a commercial property financing task.  When comparing mortgage professionals, ask each one several questions before you fill out any loan application.  A good lender should be able to get you through the financing process leaving you confident that you made a sound financial decision.  If after a few questions and a brief conversation you do not feel comfortable with the mortgage professional, simply call someone else.




Eric D.
Pleasure to work with and extremely knowledgeable

Ronny was a pleasure to work with and is extremely knowledgeable. His hard work was never ending until the job was done. They handled a complex lease and guided us through entire process, including the paperwork. Not to mention a below market lease rate and more than all the features we needed in a site. We later used Assets America for a unique equipment financing deal where once again Ronny and team exceeded our expectations and our timeline. Thank you to Assets America for your highly professional service!

exp MFGroup
Great experience with Assets America

Great experience with Assets America. Fast turn around. Had a lender in place in 30 minutes looking to do the deal. Totally amazing. Highly recommend them to anyone looking for financing. Ronny is fantastic. Give them a call if the deal makes sense they can get it funded. Referring all our clients.

William P.
Assets America guided us every step of the way

Assets America guided us every step of the way in finding and leasing our large industrial building with attached offices. They handled all of the complex lease negotiations and contractual paperwork. Ultimately, we received exactly the space we needed along with a lower than market per square foot pricing, lease length and end of term options we requested. In addition to the real estate lease, Assets America utilized their decades-long financial expertise to negotiate fantastic rates and terms on our large and very unique multimillion dollar equipment purchase/lease. We were thankful for how promptly and consistently they kept us informed and up to date on each step of our journey. They were always available to answer each and every one of our questions. Overall, they provided my team with a fantastic and highly professional service!

Bob B.
The company is very capable, I would recommend Assets America

Assets America was responsible for arranging financing for two of my multi million dollar commercial projects. At the time of financing, it was extremely difficult to obtain bank financing for commercial real estate. Not only was Assets America successful, they were able to obtain an interest rate lower than going rates. The company is very capable, I would recommend Assets America to any company requiring commercial financing.

Ricardo L.
Assets America was incredibly helpful and professional

Assets America was incredibly helpful and professional in assisting us in purchasing our property. It was great to have such knowledgeable and super-experienced, licensed pros in our corner, pros upon which we could fully rely. They helped and successfully guided us to beat out 9 other competing offers! They were excellent at communicating with us at all times and they were extremely responsive. Having them on our team meant that we could always receive truthful, timely and accurate answers to our questions. We would most definitely utilize their services again and again for all of our real estate needs.

Assets America is a great company to work with

Assets America is a great company to work with. No hassles. Recommend them to everyone. Professional, fast response time and definitely gets the job done.

DAC Team
Great experience

Ronny at Assets America has been invaluable to us and definitely is tops in his field. Great experience. Would refer them to all our business associates.

MF Group
We were very pleased with Assets America’s expertise

We were very pleased with Assets America’s expertise and prompt response to our inquiry. They were very straight forward with us and helped a great deal. We referred them to all our business associates.

Manny C.
Worked with this company for decades

I’ve worked with this company for decades. They are reputable, knowledgeable, and ethical with proven results. I highly recommend them to anyone needing commercial financing.

David B.
Top-notch professional

Ronny was incredibly adept and responsive – top-notch professional who arranged impressive term sheets.

Monte M.
Assets America helped us survive a very difficult time

Assets America helped us survive a very difficult time and we most definitely give them 5 stars!

Brent G.
Gave me direction to go

Ronny was very friendly and though we were unable to make something happen at the moment he gave me some direction to go.

Allan E.
Highly recommend them for any type of commercial financing

My business partner and I were looking to purchase a retail shopping center in southern California.  We sought out the services of Ronny, CFO of Assets America.  Ronny found us several commercial properties which met our desired needs.  We chose the property we liked best, and Ronny went to work. He negotiated very aggressively on our behalf. We came to terms with the Seller, entered into a purchase agreement and opened escrow.  Additionally, we needed 80 percent financing on our multimillion-dollar purchase.  Assets America also handled the commercial loan for us.  They were our One-Stop-Shop. They obtained fantastic, low, fixed rate insurance money for us.  So, Assets America handled both the sale and the loan for us and successfully closed our escrow within the time frame stated in the purchase agreement.  Ronny did and performed exactly as he said he would. Ronny and his company are true professionals.  In this day and age, it’s especially rare and wonderful to work with a person who actually does what he says he will do.  We recommend them to anyone needing any type of commercial real estate transaction and we further highly recommend them for any type of commercial financing.  They were diligent and forthright on both accounts and brought our deal to a successful closing.