Distressed property owners may consider a commercial loan workout as a potential solution when they realize that their properties may become foreclosed. This is to be expected during an economic downturn because the income that is generated by assets, such as hotels, apartments, strip malls, motels, office buildings and warehouses, will naturally go down. Because more people are out of work and underemployed, the number of hotel guests, apartment renters and others, is substantially decreased. Thus, the revenue generated by such commercial properties will plunge down and may soon be insufficient to fund the mortgage payments. Hence, in order to prevent the property from being foreclosed, owners often request for changes to the payment schedule as a way to avoid default and foreclosure.Unfortunately for the troubled property owners, banks would want to discourage adjustments to the monthly payments. This is only natural because such changes would mean lower monthly income for the lenders. For a business that depends for its existence on the availability of funds that it can lend to generate more money, the reduction in cash flow can have grave consequences. Thus, property managers are likely to find themselves facing a formidable wall or barrier when they first ask for a commercial loan modification agreement. After the initial rejection, many borrowers give up because they are unaware of the proper way to present their case to the banks.A number of them may consider the possibility of commercial short sales, particularly those owners and businesses that have decided that they can no longer hold on to the property. Rather than give in to a foreclosure, in short sales commercial properties are sold for heavily discounted prices. However, the bank will also have to agree with this transaction because the price is often not enough to completely pay for the balance of the loan. Thus, the lender should be willing to forgive the difference between the unpaid amount and the selling price. Just like the loan adjustment, short sales will require negotiations with the bank.Commercial property owners do not have to be discouraged when the banks reject their application for a commercial loan workout. It just means that they have not presented their situation in such a way that the lender is convinced that they have really lost the capability to make the monthly payments. It is important to remember that banks do not want to lose the regular monthly payments. There is also the possibility that the borrower is actually able to come up with the installments but the application for a loan adjustment is being made to make room for other financial obligations. It may help if the property owner hires a company that specializes in these negotiations because they have the knowledge and the experience on what the lenders consider to be important. Oftentimes, these companies would send a specialist to the office of the borrower who will then conduct a thorough analysis of the loan documents to determine the best way to negotiate with the bank.