Whether you are a business owner or a property investor, there are a number of reasons to consider refinancing commercial real estate. For some, it’s all about getting lower payments. For others, it’s about freeing up capital or reclaiming equity. Whatever your reasons, here are some of the big benefits you can take advantage of by refinancing commercial real estate.
Lower Payments and Better Interest Rates
Many commercial mortgages, especially those secured through traditional lenders, have variable interest rates. As we have seen over the past three years, the Fed can impose arbitrary interest rate hikes, which means payments on commercial mortgages keep going up. Refinancing commercial real estate gives owners an opportunity to lock-in lower payments at a fixed interest rate, instead of taking your chances with unpredictable market fluctuations.
Boosting Cash Flow
By refinancing commercial real estate, the resulting lower payments and fixed interest means less money is going out the door to pay commercial mortgages and fluctuating interest rates. The improved cash flow allows entrepreneurs to take advantage of lucrative business opportunities that would otherwise be unaffordable due to high payments.
Recouping Equity on Commercial Real Estate
Refinancing commercial real estate can also be used to recoup equity through a cash-out option. A cash-out option can free up a considerable amount of capital which can be used for anything from paying down liabilities to taking advantage of growth opportunities.
Debt Consolidation through Refinancing Commercial Real Estate
Most people who have been in the commercial real estate investment business for any amount of time have multiple properties in their portfolios. Juggling multiple loans with their own payments and varying interest rates can be a headache at the very least, and a major financial strain. Refinancing commercial real estate and consolidating debt on multiple properties can provide an opportunity for investors to take advantage of better pricing, interest rates, and amortizations.
Nanaki Capital works with clients to create commercial real estate solutions tailored to their needs. Whether you are looking to refinance your commercial mortgages to get better rates, or you want to leverage equity or consolidate the debt on multiple properties, contact the team at Nanaki Capital today.
