A detailed business plan is a key requirement for your commercial mortgage application. Your plan will outline what your business does, how it operates, and how it plans to grow.
Every mortgage is a risk for lenders. The most effective commercial mortgage business plans illustrate why that risk is worth taking.
As you plan your real estate investment, take the time to understand how to write a business plan for commercial mortgage approval.
7 Essentials for a Business Plan for Commercial Mortgage Approval
It’s important to look at your business at a high level and detail each element so that a lender can understand your model and your aspirations. A solid business plan can make the difference between an offer and a rejection.
All business plans should include the following information:
1. Your Executive Summary: All successful commercial mortgage business plans feature killer executive summaries. The summary needs to describe your business, its goals, its points of differentiation, and why you need a commercial mortgage. Keep it simple and impactful.
2. A Description of What Your Company Does: In this section, you will elaborate on how your business was formed, what it does, and where you want to take it next. This can be detailed, but, avoid repeating information that can be better presented in the following sections.
3. Details of Your Management Team: Lenders want to know that you have the leadership to succeed in your business goals. An overview of your management, including previous experience, must be included in commercial mortgage business plans.
4. Essential Financials: Financial data will provide context for your current and future strategy. Details matter. Important financials include earnings and outgoings dating back at least three years.
5. Your Growth and Marketing Plans: A successful business plan for commercial mortgage approval needs to do more than just indicate where you want to take your company. You need to illustrate how you will achieve goals. Marketing and growth strategies should be outlined.
6. Production / Execution Plan: Do you have the resources to achieve your targets? If you will be an owner-operator of industrial property, do you have equipment and supply chains set up? If you are seeking to buy property to manage and rent, do you have existing tools in place to manage tenants?
7. HR Strategy: Depending on the size of your business, you may need to explain how you plan to hire and retain the talent that will help you achieve your goals.
Supporting Documentation for Commercial Mortgage Business Plans
It’s not enough to simply state your intentions. You will need verified documentation to provide as evidence. This can include contracts with suppliers and staff, bank-issued transaction records, contracts with third parties, market research reports, etc.
Documentation needs can be extensive. Knowing what to include can be challenging. This is why commercial real estate clients prefer to work with licensed Ontario mortgage brokers.
Build the Most Compelling Business Plan with a Mortgage Broker
Developing a business plan for commercial mortgage approval can be time-consuming and at points confusing. If you are making a commercial investment for the first time, a mortgage broker will become an invaluable asset.
We can help you to prepare your business plan with all the supporting documentation that gives your application an edge. With experience and a deep understanding of the mortgage industry, we know exactly what lenders want to see.
Talk to us today if you want expert support throughout the mortgage application process, the lowest possible rates, and the best terms. Commercial property investment can help you to achieve your personal and business goals. We provide the expertise to bring it all together.
To book an appointment to discuss your needs and learn more about how Mortgage Capital Investment can help you, call 416-877-7438 today, or contact us.
Lowest Residential Mortgage Rates in Canada*
|Term||OUR RATE||Bank Rate|
|3 Year Fixed/ 25 yrs||3.89%||4.39%|
|3 Year Variable/ 25 yrs||2.60% Promo||3.36%|
|5 Year Fixed/ 25 yrs||4.29%||4.59%|
|5 Year Variable/ 25 yrs||2.65% Promo||2.99%|
|5 Year Fixed/ 30 yrs||4.79% Promo||5.29%|
|5 Year Variable/30y||3.20%||3.70%|
Updated: June 22, 2022
* Current promotion rates may provide an additional 0.05% discount or may be anytime discontinued at the Lender discretion . Rates may vary between geographic regions and the posted rates on this website may not be available in your area. Please contact our MCI office for more details and current promotions.
LOWEST REGULAR RATES IN CANADA* * Current promotion rates may provide an additional 0.10% discount. Rates may vary between geographic regions and the posted rates on this website may not be available in your area. Please contact our MCI office for more details and current promotions.