Commercial Property Loans Percentage
On the other hand, commercial property buyers qualify for 80-85% loan margins for commercial property purchases regardless of the number commercial properties purchased. This differs from residential property loan where 90% loan margin is accorded to the first 2 properties and the 3rd residential property qualifies for only 70% loan.
So what types of properties require commercial property loans? Below are the type of properties that will require commercial property loans.
- Retail shop lot / Shop house
- Office units
- Factory lots
- SoFo (small office, flexible office)
- SoVo (small office, virtual office)
- Commercial land
- Agricultural land
- Serviced apartments
- SoHo (small office, home office): this depends on bank policy
Factors such as location, type of commercial property, type of land and usage, location in mixed development, total number of units and floor location are all taken into consideration in the process of accepting and approving commercial property loans.
Documentation Needed for the bank
- Form 24 & 49
- Latest P&L (Profit & Loss) Statement
- Memorandum of Article
- Company Profile
- Form 9
- 12 months bank statement
- Latest audited report
- Form A and Form D
- Name card
Banks also place certain restrictions on the types of commercial properties they would finance hence you might be offered a lower margin of finance if the banks deem the commercial property of your choice is not commercially attractive or viable. The key is to shop around and compare loan details.
Diversifying your property portfolio is generally on of the key reasons for looking at commercial properties. Investors are likely to invest in commercial properties to generate revenue and get profits by leases out to long-term or short-term tenants. With a favourable commercial property loan, coupled with well-managed commercial property, one can get excellent revenue or sale profits.
If you are looking for a commercial property loan, check out https://limraassets.com.my/financing-solutions/ for a detailed comparison of available commercial property loans.
About Limra Assets
Limra Assets is a Shariah-compliant financing solutions financier that provides loans for property financing, SME businesses loans and gold investment. We offer a range of financing options to help individuals and businesses, including alternative financing for businesses that are unable to obtain funds. Our goal is to provide access to funds for investments in a Shariah-compliant manner that focuses on transparency, customer service, and competitive rates, Limra Assets can be a valuable partner in your gold investment journey.
If you’re interested in learning more about Limra Assets and our Shariah-compliant financing solutions for property purchases, gold purchases or business loans, please contact us for more information.
Disclaimer:
It is important to note that taking out a loans for any purchases and gold investment, whether through Limra Assets or any other lender, carries risks and should be approached with caution. It is important to carefully consider your financial situation and investment goals before taking out a loans, and to ensure that you fully understand the terms and conditions. Additionally, investing in gold carries its own risks and should be done with the guidance of a financial professional. This information and all external links are provided for educational purposes only and should not be considered financial advice.
So you’ve been eyeing a commercial property and now you’re ready to make a purchase. Before you go any further, it’s good to understand the intricacies of purchasing commercial properties as well as how commercial property loans work. The following are some helpful information that will assist you in the process of securing your commercial property loan.
Commercial Property Loans Percentage
Firstly, what is the commercial property’s maximum loan percentage? For commercial properties, the maximum loan that you can obtain is up to 85% under personal name as opposed to 90% loan for residential properties. This difference can be a key in your decision making as you will generally need to put more cash upfront for commercial properties compared to residential properties.
On the other hand, commercial property buyers qualify for 80-85% loan margins for commercial property purchases regardless of the number commercial properties purchased. This differs from residential property loan where 90% loan margin is accorded to the first 2 properties and the 3rd residential property qualifies for only 70% loan.
So what types of properties require commercial property loans? Below are the type of properties that will require commercial property loans.
- Retail shop lot / Shop house
- Office units
- Factory lots
- SoFo (small office, flexible office)
- SoVo (small office, virtual office)
- Commercial land
- Agricultural land
- Serviced apartments
- SoHo (small office, home office): this depends on bank policy
While banks have differing criteria when it comes to accepting and approving commercial property loans, the general criteria is always the viability of business for the commercial property.
Factors such as location, type of commercial property, type of land and usage, location in mixed development, total number of units and floor location are all taken into consideration in the process of accepting and approving commercial property loans.
Documentation Needed for the bank
So what documents do you need to furnish the bank in order to apply for a commercial property loan? For a Sdn Bhd company (purchasing under company name) that comprises of 2 individuals or more, you will require the following documents.
- Form 24 & 49
- Latest P&L (Profit & Loss) Statement
- Memorandum of Article
- Company Profile
- Form 9
- 12 months bank statement
- Latest audited report
For those who are running a business under Sole Proprietorship or Partnership, they will be required to provide additional documents namely
- Form A and Form D
- Name card
For commercial property loans, you need to be aware of a lower maximum margin of finance compared with the 90% for residential property loans. Be ready to put up more cash upfront. Also be prepared for a lower maximum loan tenure, ranging from 25-30 years for commercial properties.
Banks also place certain restrictions on the types of commercial properties they would finance hence you might be offered a lower margin of finance if the banks deem the commercial property of your choice is not commercially attractive or viable. The key is to shop around and compare loan details.
Diversifying your property portfolio is generally on of the key reasons for looking at commercial properties. Investors are likely to invest in commercial properties to generate revenue and get profits by leases out to long-term or short-term tenants. With a favourable commercial property loan, coupled with well-managed commercial property, one can get excellent revenue or sale profits.
If you are looking for a commercial property loan, check out https://limraassets.com.my/financing-solutions/ for a detailed comparison of available commercial property loans.