Christian Commercial Loans
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Christian commercial loans are those specifically for Christian businesses or meant to be used to obtain business property for a faith-based business. These require specific qualifying information in order for a borrower to become approved. The applicant must include a statement of why they need the funds and their source of repayment. Information that should be included on an application includes financial statements, property evaluation, and a repayment projection. Extra information such as construction plans and building specifications should be included as they apply. This type of lending is not offered by every lender and mortgage brokerage, especially not one for a faith-based business. Those that specialize in providing this type of lending can be found in the phone book or using an Internet search engine.
In order for an application to be reviewed, it is necessary for the borrower to pay a non-refundable fee. This fee allows the lender to study the usually extensive proposal of the borrower. Another reason, however, is to discourage frivolous applications from being submitted. A commercial loan is considered one that is not classified as residential. The largest difference between these and residential are the repayment sources. The borrower's income and assets are reviewed for qualification when receiving a residential amount. This lending requires the income generated by the property to repay the commercial loan.
Such lending is often given to borrowers with the intent of the property income paying off the amount, and sometimes the borrower is not held liable if the property fails to repay according to the agreement. The property itself provides the collateral for Christian commercial loans, and if the amount is not repaid, then the property is sold or auctioned for repayment. A lender will first evaluate the property to confirm its worth before even viewing the borrower's income generating plan for the property. If the property is not worth what the borrower needs to purchase and operate the business, then the commercial loan is denied.
The issuing of these funds is still very dependant on the borrower's credit score to determine the interest rate. The lower the borrower's credit score, the higher the interest rate on a commercial loan. The higher the borrower's credit score, the lower the interest rate. One of the best ways to improve an individual's credit score quickly is to pay down the balances on credit cards until they fall below 20% of their credit limit. This can raise a credit score up to 30 points within a 30 day period of time. Ideally, a borrower would like to have no balance on the credit cards. The most important thing is to keep one's promise on Christian commercial loans and pay them back. "When thou vowest a vow unto God, defer not to pay it; for he hath no pleasure in fools: pay that which thou hast vowed" (Ecclesiastes 5:4).
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