Why Assisted Living Non Recourse Loans Are a Good Choice

If you’re planning on building or acquiring a health care or assisted living facility, you will most definitely require  substantial capital to carry out your project. Getting a loan is one effective means in getting the financing you need; however most loans are recourse loans, which means that you will need to personally sign as guarantor on the loan. Fortunately a non recourse loan does not hold you personally liable for your debt. You can use this type of loan to finance your health care facility projects. Here are some of the reasons why going for non recourse lenders are best:

Your business can serve as collateral in non recourse financing

Most lenders require collateral to qualify for the loan. In a non recourse loan, collateral is almost always a requirement prior to approval. Since the business you intend to put up can serve as collateral on your loan, getting approved for the financing you need is easier through non-recourse financing.

You are not the guarantor on a non recourse loan

As stated above, you will not be personally liable on a non-recourse loan. This in itself is already a huge advantage, since you won’t be accountable for the loan even if your business fails to perform as profitably as expected. Even if your business fails, the lender won’t be able to seize your personal assets. Non-recourse lenders are very limited in their ability to collect on a loan that is in default.

Non recourse loans are assumable loans

Since a non-recourse mortgage is an assumable loan,it is easier for you to sell your property. Assisted living non recourse loans are generally suitable in financing your health care business, and since the mortgage is assumable, transferring the liability to someone else is also easier. If, at the time that you’re selling your property, interest rates are higher, you stand to gain from the transaction as well.

Competitive rates

You can also take advantage of more competitive non-recourse loan rates, since a non recourse loan may offer a much better deal than a secure loan. There are non-recourse financing programs which offer lower APR or Annual Percentage Rate,if you are able to prove your credit worthiness. Many lenders offer more competitive rates than others so it is best to shop around for the best deal, before making an application.

Many lenders offer health care financing for facilities such as assisted living centers. However not all of them offer a non recourse loan program. Given the advantages of these types of loans, it’s easy to see why many individuals choose these types of low-risk and more affordable financing.