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Understanding Commercial Mortgage Underwriting

Commercial Mortgage
Posted on 
February 2, 2017

Nonconforming commercial mortgage lenders have the ability to close loans for their brokers in a timely manner, but the speed of the underwriting process depends largely on brokers. In order for your transactions to close quickly and smoothly, you need to understand what your lender needs in order to fully underwrite a deal.

Here’s what you need to know in order to get your borrower’s deal funded and to earn your commission:

Learn about your borrower.

Before anything else, you need to get to know your borrower and the property they’re going to be pledging as collateral. Make sure to discuss in detail their current financial situation, as well as their plans for the money. Once you’re comfortable with your borrower and their commercial mortgage request, you can begin the submission process.

Submit a completed application.

When you’re ready to submit the deal to your small-balance commercial mortgage lender, you need to make sure it’s complete. In order to underwrite a deal, your lender will need some basics: a completed 1003 or commercial mortgage application, a tri-merge credit report, a loan submission summary and photos of the property. Different lenders will have different submission requirements, so make sure you discuss these with them before you send them the deal.

Cooperate with your lender.

After your initial submission, your small-balance commercial mortgage lender will likely need a few more documents to fully underwriter your borrower’s request for financing. Work with your lender to make sure that these documents are obtained as quickly as possible so that the mortgage underwriting process doesn’t stall.

Help your lender resolve issues.

When it comes to small-balance commercial mortgages, it’s not unusual for a few small obstacles to crop up during the underwriting process. You and your borrower should be open and honest about these issues so that your lender can solve the problem quickly and efficiently.

Whether or not a small-balance commercial mortgage closes will depend on how complete your submission is and how well you work with the lender if additional information is needed. Talk to your lender about their submission requirements before sending the deal and make sure you have all of the necessary documents. Remember to cooperate and be honest throughout the underwriting process. Keeping all of this in mind will allow you better determine which loans will fit your lender’s guidelines, which will result in more closed loans.


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