A sicl is a commercial loans that does not require the full documentation that is required of a full document commercial loan. This type of commercial loan does not require the borrower to be able to prove that they can afford to make the loan payments from their own personal income but instead relies on the rents of the commercial property or the possible rents for the property.
Financial Benefits of a stated income commercial Loan include:
* Less Documentation The stated income commercial loan requires less documentation than a tradional commercial loan. In many cases since the loan is only underwritten to the properties cash flow or potential cash flow it is not necessary to provide as much documention.
* Easier approval process This commercial loan has an easier approval process because it does not have to be underwritten to both the property cash flow and a secondary repayment source such as the borrowers personal income.
secondary repayment source such as the borrowers personal income. Lower credit score requirements Some of these commercial loan programs also have reduced credit requirements.
Examples of a typical stated income commercial loan borrower include:
* A self employed small business owner that does not report all of their income on their tax returns who is looking to purchase a commercial property using a commercial loan.
* A real estate investor that does not show the amount of income necessary to qualify for a traditional commercial bank loan but the property has rental income that will support the debt payments.
A stated income commercial loan is designed to help a borrower purchase real estate that they would otherwise be unable to purchase without a significant down payment. The commercial property does not have to be held in the name of the borrower or the operating company but can be held in the name of a holding company.
There are certain criteria for eligibility of this type of commercial loan.
The business that is occupying the property must be in business at least 2 years.
The guarantors credit score must be 600 or above.
The guarantor and operating company can not have a bankruptcy that is more recent than 3 years.