Not all loans have the same process, but by better understanding the elements of a commercial real estate loan, property owners are empowered to make decisions that maximize the profitability of their portfolio. Here, we will dicsuss:
- What happens in the pre-approval stage of a loan.
- What happens when a loan is approved and a sale is closed.
- How to finance a tax-free 1031 Exchange
Stage 1: Pre-Approval
The pre-approval stage can take around 10 business days if all documentation is submitted (use our pre-approval documentation checklist), all properties are identified accurately within the 1031 Exchange, and the property closes at an amount that enables the funding of an exchange. Schedule a meeting with one of our loan experts to learn more about your financing options and how to increase your chances for pre-approval.
Stage 2: Approval and Closing
Loan approval occurs at closing when the funds are approved to be transferred to the seller. In the case of a 1031 Exchange, the funds are transferred through escrow to the qualified intermediary, who applies the tax-free funds to the purchase of the acquired property.
Stage 3: How to Finance a Tax-Free 1031 Exchange
Schedule a meeting with one of our loan experts to learn more about your financing options and how to increase your chances for pre-approval.
Conclusion
With a better understanding of the loan process in hand, you are more equipped to identify loan offerings with better terms, make strategically timed offers, and submit applications with more intentional and appropriate documentation.
However, we would advise speaking to a professional regarding a loan. Schedule a meeting with our qualified loan professional today to explore your financing options.
