Given the commercial loan rates available at this time, it is worthwhile for everyone to take the time to review the terms of your commercial loan obligations. Commercial interest rates are now available to creditworthy borrowers at 3.8% to 4.75%, either fixed or variable, for terms of five to ten years. Most commercial banks are gearing up to facilitate their ability to make these commercial loans.
During all of 2011, most commercial banks were not making commercial loans. Similarly, these banks did not experience growth as expected. However, most of these banks did not experience the losses as they did during 2008 through 2010 and are therefore poised to aggressively enter the commercial loan market. From our discussions with these lenders, they will creatively approach each possible loan transaction to assist commercial borrowers with new financing or to refinance existing commercial loans at a lower interest rate and extend the term of the loan out to ten years.
The interest savings each year on a $500,000.00 commercial loan at 3.8% per annum versus 6% per annum is significant. The interest expense at 6% is $30,000.00 per year versus $19,000.00 each year at 3.8%. The savings of $11,000.00 each year over five to ten years allows for additional capital infusion to facilitate the growth of any business.
Commercial loan availability has turned a corner and with it comes the optimism of the commercial bank lenders to assist the business community. It would be advantageous for every commercial borrower to take advantage of the current circumstances and either refinance current commercial loans or replace a current loan with a new commercial loan product that more adequately fits each borrower’s business requirements.
Let our experienced commercial attorneys provide guidance about which banks are actively seeking your loan business and assist you with the loan transaction.