Many business people find it difficult to secure commercial property loans because the banks want at least a 30% deposit and in some cases even 40% deposit. A scheme which has been around for a few years in South Africa enables borrowers / investors to put down as little as even 5% and they equity partner will put in the difference ie 25% up to 35% and then the borrower and the equity partner will go to a local South African bank and secure the difference.
The share holding will be apportioned according to the contribution by each party; so if a 30% deposit is needed and the borrower puts in 15% and the equity partner puts in 15% they will be equal partners.
What is really good is that the borrower / entrepreneur after three years and up to ten years that the loan has been running, can buy back what ever portion of the shares they wish to or if they do not wish to they can allow the status quo to remain. If in year 4, the borrower has funds available to buy back 1 % shares, they can or 10% or even the full 15%, the balance of the shares can be bought back to increase the shareholding percentage to ultimately reach 100% ownership.
The price to buy back the shares outstanding will be set at the market value of the property, at that point in time.
This scheme is applicable to commercial property such as Factories, Offices, Warehouses, Retail Shops and Shopping centres. No agricultural and no residential can be funded.
For more information on this readers can go to http://www.nhfinance.co.za and submit an enquiry.
Article Source: http://EzineArticles.com/?expert=Rocky_Pretorius
