Learning The Secrets About Resources
What Is An Investment Grade Tenant
Most of the time, credit rating is given to large national companies that issue public bonds. Some have credit store and this s its counterpart. The rating that is given to each company is determined by several agencies.
In a credit rating, you will be able to see two categories. The company that you have will have an investment grade rating the moment that it will have a BBB or Baa3 rating. You will probably get a non-investment grade the moment that the rating will not reach the former. The moment that you are rated as an investment grade company, the is a very low chance that you will not be able to pay out the credit that you have. The financial status of every company is being checked once in a while by the agencies that provide the ratings that is why the ratings will change over time as well.
There are a number of big and medium size companies that are already having an investment grade rating. The moment that these companies will lease a property, then it is called as credit lease and the tenants that leased the property is called as credit tenants.
One sure fact the moment you have a credit tenement that leases your property is that you will get the monthly payment every time if you are there of the property. It is when you have a credit tenant in your building that the property value of it will increase as well. If the credit tenants have a long term lease, then you can definitely get this advantage. It is when a triple net lease is made that the owner of the building will get additional benefit as the tenant will cover the insurance, operating expenses, taxes of the property. The tenets in the other hand will also have better control of the property without thinking much of the landlord. But the landlord must also know that this set up will have lower rent.
The tenant that will lease your property should be considered by you when you are the building owner. When it comes it your investment property, the bank will make sure that they will check your credit score before they will proceed in lending you money. It should be that the exchange will not be difficult. You can go and look the investor’s guide so that you will have the needed help.
With regards to the obligations to the landlords, the institutional investors is the one that will provide the credit-tenant financing. The reason for this is because of the triple net terms. The length of the lease is the one that will match the loan term. The responsibilities will be carried out by the tenant and not the landlord.