A mortgage basically involves taking a loan amount from a party in order to purchase a property. When the property is to be used for residential purposes, it is called a residential mortgage. However, when the asset in concern is commercial like a warehouse or an office space, it is deemed as a commercial mortgage. The rates and the fees for a commercial mortgage vary from the residential one. It is imperative to know about commercial mortgages in Toronto in detail.
Different types of commercial mortgage property
Purely residential- consists of apartments or condos with 4-5 units. You can apply for a home equity loan Toronto in this kind of property.
Mixed commercial residential- the ground floor is an office space and the others are for residential purposes.
Purely commercial- space exclusively for office or a shopping mall or a warehouse.
The commercial mortgage rates
It is higher than the residential mortgage rates which are normal. If you want to know the exact percentage, you can search for commercial mortgage rates Toronto in a search engine. The rate also depends on the type of property being taken. Thus, it is highly variable and depends on the financial entity as well.
Different fees for a commercial mortgage in Toronto
The fees are also higher than the residential mortgage fees. A few of them are-
Lender fees- this is under the discretion of the person providing you the commercial mortgage. It ranges between 4-6%.
Broker fees- it is not always possible to get a property in Toronto on your own. If you take the help of a broker, you have to pay a broker fee of 1-2%.
Legal fees- this includes the fees for the services and the notary along with other legal documents. Search for bad credit mortgage Toronto and if you fall in that category, this fees will be more.
Appraisal- it is used to check the value of the property over a period of time.
Insurance- this will protect your newly owned property from different types of frauds.
It is clear that commercial mortgage in Toronto is a slightly expensive process. However, once the deal is done, it is definitely a good one.
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