Commercial Equity Line of Credit

• Auto repair/auto body/car wash
• Convenience store
• Dental or medical facility
• Funeral home/crematorium/mortuary
• Gas station (up to 10 years old)
• Health club/gym
• Ice or roller skating rink
• Movie theater
• Parking garage
• Refrigerated warehouse
• Restaurant
• School (non-public, daycare, or preschool)
• Self-storage facility
• Skilled nursing or assisted living facility

Small business owners and real estate investors can use the Commercial Equity Line of Credit to borrow against the equity in commercial property to meet both short and long-term business needs and to take advantage of unexpected business opportunities. Many property owners use the line of credit for items such as working capital, inventory purchases, business improvements, and large equipment upgrades.

Information about each individual, the business entity (if any), and real estate specific information will be needed at application, such as contact information, tax payer identification or social security number, business information (start date and type), and information about your property (property type, usage, etc.). 

If the property is owned by individuals, all owners must be represented on the application. For property owned by a business entity, all owners who have 25% or more ownership must apply, and a minimum of 51% of the business ownership must be represented on the application. At the time of application, applicants will be provided a checklist of required documentation for each individual and the business.

After you complete the application and submit the required financial documents, an underwriter will provide a lending decision. If your application is conditionally approved (approved, pending outstanding items such as appraisal, insurance validation, etc.), a Wells Fargo Commercial Real Estate Consultant will contact you to discuss financing options and help guide you through the loan process. If your application is not approved, you will be sent a letter within 10 to 15 business days with an explanation.

As a part of the application process, we will verify that you have standard property insurance. If certain environmental hazards are present or if the property is located in a flood zone, environmental or flood insurance may be required to obtain credit.

The interest rate on lines of credit will be variable and tied to the Wells Fargo Prime Rate. Once all required financial documents are completed and received, your spread over prime rate will lock for 90 days.

Your spread over prime rate will be determined as a part of our approval process and will be based on several factors, including your personal credit history, the line amount, term selected, property type, and lien position.

In general, most Wells Fargo loans use the Wells Fargo Prime Rate as a base rate. The Wells Fargo Prime Rate is similar to (but not always the same as) the prime rate quoted in the Markets section of The Wall Street Journal website.

Upon a conditional approval, a deposit is required when you accept the offer.

• Up to $250,000 requires a $500 deposit
• Over $250,000 requires a $1,000 deposit

If the line of credit closes, the deposit will be credited toward any applicable fees, and any unused portion will be refunded upon booking. The deposit will not be refunded if the line of credit transaction does not close.

Origination:

• 1% origination fee at closing

Annual:

• No fee for the first year
• After the first year, 0.25% of the line amount will be assessed during the 5-year draw period (with a minimum of $250 and maximum of $1,000)

If you pay off and close your line of credit within the first three years, there is a $3,000 early closure fee. After three years, there is no fee.