Commercial Real Estate Loan Strategies

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The use of "Stated Income" (no tax returns and no income verification) commercial loans is an important strategy to avoid several commercial credit loan problems. For example, many borrowers will simply not qualify for a commercial real estate loan if tax returns are used due to high business expenses (and low net income).To know more about Commercial Real Estate Loan Strategies visit

Very few traditional banks use Stated Income for a commercial real estate loan. Many/most commercial lenders will perform thorough income verification as part of their underwriting process. Most non-traditional commercial lenders do not require tax returns or any income verification for a Stated Income commercial loan.

Traditional bank commercial loan underwriting conditions will normally include copies of tax returns as well as a requirement to sign IRS Form 4506 which authorizes the lender to obtain tax returns directly from the IRS.

Some lenders need this form in addition to current tax returns. The more tricky use of this form is when lenders make a point of not requiring tax returns but separately ask the commercial borrower to sign this form.

The most common explanation in asking for this form will involve the words "routine request". This will usually occur just before the final closing and be further characterized as "one final small detail". In reality IRS Form 4506 is neither "routine" nor a "small detail".

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