The lender receives repayment of commercial mortgage principal and interest over lifetime of loan. If you default on loan and go into arrears then lender can foreclose and take possession of property which was used as collateral.

Generally speaking, interest on a commercial mortgage is tax deductible and net proceeds of loan are not considered to be taxable income. However, you should always check with your accountant to be sure because tax consequences can be severe should it be determined that your usage of funds was not for a qualified business purpose.

Should you be seeking a commercial mortgage for purposes of operating your business, rather than actually buying property, then lender will either want to re-finance your current mortgage, and include enough money to provide amount that you are seeking, or they may arrange an equity line where they lend you difference between current value of your commercial property and amount that you owe on current mortgage.

There are generally two types of interest schemes available when you are applying for a commercial mortgage.

The fixed rate commercial mortgage establishes an interest rate that is in place either for life of loan or for a fixed period of time. If it is for a fixed period of time then it will normally convert over to second type of rate, which is called a variable interest rate, after fixed time period expires.

Sending an unsolicited business plan to almost anyone is a waste of time and postage. Your risk capital search goal should be to get prospective investors to read your Executive Summary. This means that your Executive Summary must be readable, focused, answer three questions and be credible.

Your Executive Summary is hook to get investor to take time to read your business plan. If you can't set your hook, you'll never catch your fish. Most venture capitalists, angel investors, brokers, fund managers, merchant bankers and others with risk capital will read a short unsolicited Executive Summary. The Effective Executive Summary gets prospect to request your business plan.

READABLE Your Executive Summary should be no more than two pages in length. If you are faxing it to prospective investors, use 14-point type. You should avoid industry jargon. The reading level of your copy should not be beyond high school level. It's not that investors are high school dropouts. It's that lower reading level easier document is to read and understand.

FOCUSED Not everyone with money will invest in your company. Refine your potential investors to a list of individuals and firms that are interested in your type of venture. If you are seeking a loan, don't send your Executive Summary to a Venture Capitalist. If you are in food business in Ohio, don't send your Executive Summary to an Angel Investor interested in high tech startups in California. In fact, don't bother to send your Executive Summary to Angel Investors living more than fifty miles from you. If you are a private company, don't send your Executive Summary to a Merchant Banker only willing to fund public companies. Don't seek funding for your non-U.S. company from a source unwilling to invest outside United States.

You can use Net and a good business reference library to build your list of prospective investors. The Reference Librarian can be very helpful in suggesting reference books related to your industry and to funding sources. Use every possible combination of words related to your industry and needs in an exact phrase advanced search. Your goal should be to develop a contact list of one hundred potential investors. If you have right list and right Executive Summary, you'll get some requests for your business plan.