Many people living in Pennsylvania look to invest in commercial real estate to generate regular income and guard against inflation. Yet, many people who wish to invest in commercial real estate do not have the money to do so outright. If you count yourself among those looking to build your portfolio by investing in commercial real estate, there are several potential funding sources out there you may want to consider.
Per Rocket Mortgage, most people who wish to invest in commercial real estate do so by putting their money into multifamily properties, office buildings, retail centers, industrial buildings or hospitality entities. While the funding sources available to you may depend to some extent on the type of property you wish to invest in, the following are some possible sources of financing.
Permanent loans
A permanent loan may be available to you through a bank or institutional lender, among other providers, and it may have low interest rates. These loans work somewhat like a traditional consumer mortgage.
Federal Housing Authority loans
An FHA loan may also be an option for you, depending on the type of property you want to invest in. You may be able to obtain this loan insured by the FHA if you are investing in a health care facility or one or more types of multifamily housing buildings.
Small Business Association loans
The Small Business Association is another possible funding source you may be able to use if the commercial property you plan to invest in is likely to generate jobs and economic growth in your area.
While these are some of the more common financing options commercial real estate investors consider using, this is not a comprehensive summary of all possible funding sources.