FAQS
Commonly asked questions:
How long have we been around?
Founded in 2011, Hanover Financial Services is not a mortgage lender or mortgage broker. Instead, we operate as a consulting service that searches hundreds of
different banks and Lending Institutions for our clients to find the right lender
for their loan request.
We then put both parties together and allow you to work directly with that institution
to get the funding they need for their project.
Church and Commercial financing is our specialty.
Is there a fee for your service?:
Hanover Financial Services charges a consulting fee of $849.00. This fee becomes due only after we have received and assessed your loan application, have determined that we would be able to assist you in obtaining financing, and have found a lending source for your loan request.
As mentioned above, we are not mortgage brokers. Our job is simply to make the connection between your loan request and a viable lender or funding source and then allow you to work directly with said company thereafter.
Is church and or commercial financing available?:
Since Church and Commercial financing is a specialized form of lending, many financial institutions do not offer financing for these projects.
Fortunately, there are many lenders including a few commercial banks, Credit Unions,
Bridge, SBA, Bond Lenders, Hard Money lenders and other lending sources that do offer financing.
Before we can get you approved for any form of commercial financing, there has to be a determination as to what kind of loan will best fit your needs.
To accomplish this, we will first have a free consultation to figure out your specific needs
and which loan vehicle will be the ideal fit for your project.
How large a down payment is usually needed?:
Down payments usually range from 25% to 45%. Depending on the size and scope of the project plus the chosen funding source, your expected down payment may vary.
Please note that commercial purchases usually require a much higher down-payment than residential purchases do, usually 25-30% as most banks offer 75-80% Loan To Value(LTV) on commercial projects, under normal circumstances. Hard Money lenders will usually require a higher down-payment.
Often, potential buyers are surprised to learn that the down-payment percentage needed to finance a commercial or church property is usually much higher than that needed to buy a residential property.
Are there benefits to being pre-qualified by a lender?:
There are a number of benefits when a buyer is
Pre-Qualified by a lender before viewing a property and writing a purchase offer.
Typically, Pre Qualified clients get preference over non qualified prospects as most realtors and sellers feel more assured of a pre qualified client's ability to secure financing.
If qualified, we can typically obtain Pre Qualification for our clients within 24 hours of receiving your completed application and financial statements.
Please Note:
Any fees paid to Hanover Financial Services to facilitate a loan for your project becomes refundable in the event that the chosen Broker/Lender can not indeed fulfill an earlier promise to facilitate said financing for the client through no fault, doing, or change of heart from said client. Under those circumstances only will your fee become refundable.
What does it take to qualify for church purchase or refinancing loan?:
Every lender is a little different, but in general a church borrower:
- Needs to be incorporated(church)
- Has to have a minimum of three years or more of financial statements plus Year to Date financial statements for the current fiscal year:CPA prepared statements are preferred but not mandatory to get a preliminary loan approval.
- Needs to have sufficient payment, usually 25-30% for conventional church or commercial transactions. Hard Money loans typically require a higher down-payment (e.g. 45-55%)
- Is required to have sufficient income to comfortably make consistent loan repayments.
- If in the case that the client cannot comfortably show the ability to debt service on their own, they can always use a guarantor to add income. If you need more information on how using a guarantor can work for you, we can provide it for you with a free consultation.
How is a realistic market value determined?:
Market Value is usually determined by an Appraisal. In some cases a Broker Price Opinion(BPO) can replace the need for a formal appraisal to get valuation. In the event that you have a recent appraisal that may be over 3 to 6 months old, we can conduct a Desk Review to determine the most recent valuation of the subject property plus save on the significant cost of a brand new appraisal report.
How long can it take to buy a church/commercial property?:
There are many factors that influence the sale of a property such as location, price, building condition and unforeseen circumstances like above ground or below ground tanks or any other environmental issues which usually require an environmental report before the loan process can move forward.
Over the past few years, our experience has been that it takes an average of about two to three months to buy a church or commercial property under normal circumstances.
Church loans are considered Commercial Loans and come under the same lending guidelines; therefore the Loan To Value (LTV) for a Church loan normally ranges from 50% to 80%, but can go higher as the lender determines. To learn more, give us a call for a free consultation.
