CONDUIT LOANS Including Fannie Mae DUS - Description
Non-Recourse loans, are often only cost effective over $2 Million, Maximum 80% LTV senior note on income producing properties with fixed terms to 10 years and 30 year amortizations. These loans have either Treasury Defeasance or Yield Maintenance prepayment penalties. These loans can be excellent for improving cash flow and providing structured flexibility on properties that are not class A rated. Rates range between 175-250 basis points over the 10 year Treasury note. Core closing costs are $15,000 - $23,000 depending on third party report costs. Often referred to as a CMBS loan or Commercial Mortgage Backed Securities loan. This loan type has not been especially competitive as of late becuase of the credit crunch brought on by the lack of liquitity in the market. As of late, over 80% of income producing properties over $5 million have this type of loan. These loans are balloons with up to 10 Year Amortizations and can provide interest only for an initial period and other negotiated structures. See 10 Year Treasury Rates
CAPITAL MARKETS & NON-BANK LENDERS, including Fannie Mae 3Max -Description
Income producing properties on Multi-Family Properties, Self Storage, Mobile Home Parks, Retail Strip, Multi Tenant Office that are generally recourse and are limited to 80% LTV. Rates vary between 120 and 250 basis points over the 10 Swap Rates and have fixed periods to 10 years with 30 year amortizations. Core closing costs can be as low as $3,500 and third party report costs are sometimes aborbed by the lender. Fannie Mae DUS loans would be included in this type used to finance Multi Family properties providing lower rates than a bank loan and greater flexiblity such as, 30 year Amortizations, loan assumptions and subsequent second mortgages for equity takeouts or sales. See Swap Rates (See 10 Year Treasuries for Fannie) This is a popular commercial loan type since it is securitized through commercial banks to Wall Street and has been been severely affected by the current liquity issues.
OWNER OCCUPIED - Desciption
For Properties that are occupied by at least 51% of improved square footage that may be owned by a holding company, LLC, Trust, Corporation or Individual that may or may not earn additional income from rent paying tenants. Loan Products Available: See Swap Rates
Small Business
SBA 504 (Real Estate)
SBA 7a (Real Estate and Equipment including the purchase of a business or franchise).
BRIDGE LOANS - Description
Purchase money loan to purchase distressed unstabilized income producting properties under market value. This loan product permits a savory borrower to purchase a property that if repaired and returned to market, would have a greater value that the purchase price and the cost of repairs. See Bridge Loan
PRIVATE EQUITY - Description
This a a financial arrangement where a third party provides a cash injection pre-determined by current debt service performance and the legal language within the existing loan documents. This is not a second lien but a pledge of making payments toward the prepayment of the cash injection at a cost of 11% or more. Instead of debt being added to the balance sheet, a legal framework is put into place that makes the supplier of capital an equity partner for a period of time.
Sale Leaseback - Description
A financial arrangement where either a borrower sells an owned property to us or another third party and continues to occupy the property by leasing the property. Can be a great vehicle to raise cash and not lose your business location and allow a borrower to run a business instead of manage a property.
