Real estate is a very wide industry where you can invest in many different properties and as a result, being aware of the number or types of loans you can request is indispensable depending on the real estate you’ll invest in. For hotels, you usually have to go with hotel loans instead of commercial general ones.
The main reason why you need to be specific about the loan you will be requesting is that you get different terms and conditions. While a commercial real estate loan is what most people would aim for when going for a hotel investment, it doesn’t bring many benefits when it comes to the interest rates and time you have to repay it.
Therefore, if you are a real estate investor or will be an owner-occupant who is going to start a new business in this industry, start looking for options where you can get the funds required. The usual action would be to go to banks, pension funds, or similar institutions that are known for being lenders. But the problem when relying on them for your real estate investment is that you have to meet a large list of conditions and requirements that usually limit you to get the loan approved.
Right now, requesting a loan that will be destined to a hotel is very hard to obtain due to the COVID-19 situation. Lenders don’t want to bet their money on investments that don’t seem like a good idea either in the short or long term. However, this happens with usual lenders and institutions only. Private lenders are a better option if you want to get a small or large hotel loan for your goals since they have better terms, fewer requirements, and you are most likely to have it approved.
At Commercial Real Estate Loan Pros of West Palm Beach, we can lend you the capital you need to go for your hotel investment, either if it is to buy a new property or renovate and expand the one you already own. You won’t have the main issue as with banks and insurances: provide many documents, have a high credit score, and deal with high-interest rates. We have made sure to offer better deals and loans that focus on your situation as a real estate investor in this area or as an owner. Therefore, the conditions will be based on your needs and goals, not on a general list of requirements that limits most people to even get the chance to apply for one.
Do you need a hotel loan for your investment?
The short answer is ‘yes’ if you are planning to use it for renovations or to expand your existing hotel. Of course, if you want to be for the acquisition of one as a real estate investor, you definitely can’t afford its payment with your own capital nor it is a good idea to invest all your personal money in it.
But are hotel loans easy to obtain during this pandemic? Banks, pension funds, insurance, and similar institutions weren’t offering them in 2020 due to how empty these properties and businesses were. As a result, hotels couldn’t afford to request a loan they weren’t sure to be able to repay in the estimated time nor with the high-interest rates of the moment.
However, after the interest rates were cut and hotels are clearly having a comeback, you should definitely go for the investment and the loan required since many lenders are starting to include them once more. The reason why you should decide to go for a hotel credit instead of having your own capital invested in the new renovations or projects at hand is because of the percentage of risk.
Having more time to repay the money instead of losing part of it if anything goes wrong, gives you more freedom to achieve the desired results and find solutions. Our team at Commercial Real Estate Loan Pros of West Palm Beach also offers lower interest rates and more types of financing for your hotel.
Before providing the loan, we will evaluate your lending needs and how your hotel or new investment can be solved with one of our credits. But we are confident you definitely need it if you are trying to resurface from the previous months—or if your hotel has been in crisis for a while—, or when aiming for the purchase of a new commercial property for hotel purposes.
Terms and features of our hotel loans
Every lender has different conditions and terms depending on the amount you are requesting. But most banks and common institutions look for borrowers that can meet high credit scores, have a long financial history, and most of them only focus on knowing they will have the credit repair.
As a company, we also care about it, but we are aiming for better terms where you, the lender, can get many benefits as well as us as the lenders. Therefore, you can expect terms that are most accessible and focused on your needs, situation, and type of financing you require for the hotel investment.
With that said, we need to evaluate your application, investment, or hotel first before providing all the terms for the loan and approve it. However, we have a few established ones that could vary—for good—, and the same applies for a few details of the credit:
- Loan size: you can request from $5 million to $50 million—or lower amounts depending on your needs.
- Fixed rates: we work with interest rates that go from 3.5% to 6.5% and will be fixed for the time the loan lasts.
- Amortization: from 20 to 30 years.
- Loan purpose: can be requested for either acquisition and refinances.
- Loan term: from 5 to 12 years.
During the discussion of the loan—if we approve it for you—, you can negotiate a few terms or change certain aspects in case you still apply for them as a borrower. As lenders, keep in mind we won’t be like banks or other institutions that take weeks to reply to your application.
Instead, we will get back to you in the next few hours or days at most, and discuss why it was approved or not. Also, our team will make sure to discuss your needs and focus on the situation you have with the hotel refinances you have in mind or the big investment you are about to go for.
There are so many areas or regions where we offer these services with most of them being cities.
However, if you need any of these services, you need to contact us. The list below comprises the areas where we offer these services.
We service all counties and cities throughout South Florida. However, if you need any of these services in other cities throughout the state of Florida, please contact us. See what services we offer below: