Commercial mortgages and loans with lite doc loans are available through various financial institutions and lenders. Light doc commercial loans consider a mixture of income and supporting documents without the requirement to submit all financials to confirm the ability to service a mortgage.
What exactly is a commercial lite document loan?
Commercial light doc loans require fewer financial documents for income than full-doc loans. They require primary income verification, but there is no need for the complete financials of the prospective borrower.
What documents do you require for commercial loans that require light doc?
Commercial loans with a lite doc and mortgages are similar to low-doc loans. The lenders who offer commercial loans that are lite doc require an income statement from the borrower, accompanied by an accountant’s certificate that confirms the income as a reasonable estimate of the borrower’s earnings.
Letter from an accountant for a commercial low-doc loan
The procedure in which an accountant’s note is used to prove the amount of money available is usually called a commercial lite doc loan. The letters typically take the shape of a template provided by the lender. The accountant fills out and places the letter on their letterhead.
This type of letter typically states that the accountant is confirming the following:
- The loan amount has been used.
- The commitment of the client to the monthly loan installment.
- The client’s income situation.
- They believe that the customer can afford the amount of money.
The letter, however, also includes an exclusion that states that the accountant is not held accountable by the lender because the accountant did not conduct an audit to verify the exactness of the client’s financial statements.
What properties could be used to obtain commercial loans with a lite document?
The kinds of properties that are used to make commercial loans with a lite document are:
- Property for commercial use
- Industrial property
- Retail property
- Office property
- Residential property (provided the property is not under a personal name)
Are commercial lite doc loans more expensive?
Commercially lite Doc loans may have the possibility of a higher rate of interest over regular loans. The reason for this is it is the case that the lender isn’t lending on your financials as well as tax records, instead using a written declaration of your financial ability, which is accompanied by an accountant’s confirmation and confirmation letters. Provides a lower cost option than a low-doc loan and keeps the rate close to the regular rate.
In comparing various types of loans, many customers consider the lite-doc commercial to be a great cost-effective alternative, especially when their circumstances aren’t simple.
What types of loan products are offered with commercial light doc loans?
There are several kinds of commercial light doc loans. They include:
- Variable term loan
- Fixed-rate of interest loan
- Lines of credit loans
If you are choosing a lender, you should consider whether they provide the complete product range, as only a handful of lenders who offer commercial loans with a doc-like structure provide every loan type of product.
What are the benefits of a commercial lite document loan?
- Commercial low-doc loans are reasonably priced, given the absence of documentation for income verification, and do not require the hassle of a complete financial analysis.
- Commercial light doc loans are an excellent option for those who cannot complete their financials on time for the due date but require a reasonable amount of finance.
- Commercially lite Doc loans come with an LVR maximum of 75 percent. This LVR of 75% gives the borrower a higher loan-to-value ratio than most banks’ complete doc LVR guidelines!
What are the drawbacks of a commercial lite document loan?
- A slightly higher rate of interest
- They’re available only with a few lenders, so there isn’t much competitiveness among lenders for this kind of loan.
At Commercial Lending USA, we have a wealth of experience with various lenders that provide commercial light doc loans. We can discern between a lender that offers the lowest rates and fees while also being aware of which lender has the most excellent flexibility!