There are a number of advantages to taking out commercial
mortgages:
Retain Ownership. Instead of raising funds by selling
an interest in the property or the business to an investor,
you retain complete ownership of both. The lender is only
entitled to an interest return on its mortgage, not a percentage
of ownership that an investor would expect. Also he/she
can only exercise the right if you default. You retain all
the benefits of ownership in an asset that has the potential
to appreciate in value.
Better Cash Flow. A mortgage gives you access to
capital with minimal up-front payments and the flexibility
to design a repayment schedule that suits your needs.
Maximize Financial Leverage. Financing your property
purchase with a mortgage will allow you to use your cash
flow for other pressing needs.
Simplified cash flow management. Mortgage schedules
are preset, making cash management more predictable.
Tax advantage. Interest payments on your mortgage
are tax deductible and are made with pre-tax money. Purchases
financed with profits, in contrast, are, made with after-tax
money.
