The best terms wins the commercial loan. The customer is happy.
May 20, 2014 (Newswire) - You take a small commercial loan to a small commercial bank, located just two miles from the subject property. Your borrower has excellent credit and a net worth of 1.35 times the size of the commercial loan amount. (The Net-Worth-to-Loan-Size Ratio says the borrower's net worth must be at least as large as the loan amount.) But the bank's just not feeling it.
The solution? Don't be dependent on just five or six banks and lenders, suggests the mortgage professionals of Commercial Real Estate Finance LLC. If you want to close more commercial loans, you need to develop a large databank of banks, conduits and insurance companies. Then, when you are trying to place a commercial loan, you can quickly offer it to three-dozen different lenders at the same time. The best terms wins the commercial loan. Customer Happy.
Lenders can find all kinds of reasons not to approve a commercial loan. They could be fully-invested. They could be over-concentrated in mobile home parks, even though they love them. The commercial lender could have just taken a loss on a mobile home park commercial loan, and now the lender is especially leery about lending on mobile home parks. Your loan officer at this particular bank or lender could be a complete wimp in front of Loan Committee.
We always put our commercial loans out for sale to a huge list of commercial lenders and/or private investors. "I'm sorry, Mr. First-Time-Investor, but that deal is already sold out. I'll be happy to put you down as a backup, but the truth is that you're the 7th backup. You probably won't get into this particular commercial loan". Then they want the next one, says Todd Tretsky of CRE-Finance LLC.
Okay, let's talk about your needs. You need to have a huge databank of commercial lenders to whom to offer your commercial loans. CRE-Finance LLC has that.
Then you need to know how to juice the spreadsheets, as it figures out many things, including the DSCR and Debt Yield. You need to understand the Cap Rates and sales in that area. Do you need a ProForma? What about pictures of the property and tenants? Is your Executive Summary bullet proof on all fronts? Have you run KYC Reports? Does the rent roll match the leases? Does it match what the appraiser is going to receive? Yes it goes on and on. Are you prepared? CRE-Finance LLC is.
Here are the key words that an expert in this field has to understand inside and out: Lender, Partners, Capital Stack, Common or Preferred Equity, Subordinate Capital Mezzanine Financing, Capital Stack 75/10/5. Now we have a deal. At what stop can I assume the deal for 1%?
Call today to discuss how the professionals at CRE-Finance LLC can assist you with all of your commercial lending needs. Rich Tretsky can be reached at 212-257-7307 or Todd Tretsky can be reached at 212-257-7305. Or visit our website at www.cre-finance.com.