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We can help you with all of the items listed below. Our experienced agents can provide the best representation and counsel for you. We will find you the right property in the right location with a minimum of interference with your business or practice.

If we aren't qualified to counsel you in an area we will advise you on how to get the right advice and where to get it.

We don't arrange loans but we can help you find just the right lender.

We don't own an escrow company but we follow the escrow from start to finish and make sure that you are receiving the best possible attention.

  1. Be sure that you know how much cash you can use as a down payment? This does not mean how much are you worth or what the purchase price ought to be. The purchase price part of the equation will evolve from this answer.
  2. If you wish a 90% SBA loan do not call a lender you do not know or the lender that financed your home. Not all lenders will make an SBA loan. Because of that you can use as little as 10% down payment and finance 90% of the purchase price. However, you must use over 50% of the property for your own business or practice.
  3. Don't worry if the mortgage payment and other costs of ownership add up to more than your current rent. If you take a fixed rate loan you will be fixing your rent for up to 25 years.
  4. Do not decide on the way you will take title without consulting your tax and legal advisors. You can purchase the property as one entity, usually an LLC or personally, and rent it as another business or professional entity. The owning entity should be able to utilize the benefits of owning real estate such as depreciation and other tax benefits.
  5. Don't compromise on the location. Most people tend to stay in their property for many years and a good location is very important.
  6. Don't compromise, if you can avoid doing so, on the layout that will be the very best for your business or profession. This will be your home away from home for many years. Make it a comfortable one that you enjoy going to and working in everyday.
  7. Do not ignore reading and understanding the Purchase Contract. There are many parts to the typical contract, not just the price. Too many people focus on the price and don't bother with the myriad of other items covered in the Purchase Contract.
  8. Don't skip doing your due diligence and inspections. Have the property inspected by a professional and read their report and recommendations carefully. Often the Seller will not be fixing everything that is mentioned. You may not have to make a repair or replacement for a year or for many years. It is important you understand what to costs to expect in the future.
  9. Don't ignore your long term space requirements. If you are planning for growth you may wish to buy a larger property now and rent out part of it. As long as you are using over 50% of it you can still get SBA financing. You need to find out the market rental rates to determine how much you can rent the space for. You may want the rent just to defer your expenses for 2 or 3 years or you may want the rental area as a full profit center. You need a rental survey to make this decision.
  10. Don't oversimplify the costs of property ownership. When you calculated the cost of operating your property did you take into account they new tax bill you will be receiving? You will probably be paying substantially higher property taxes than the Seller has been paying. Did you calculate the cost of insurance and utilities? Did you plan on some amount of money for repairs and maintenance?

Return to Swartz Commercial Real Estate '10 things' series

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