December 26, 2017

Commercial Real Estate Loans

Types Of Commercial Real Estate Loans

Small Balance Commercial Real Estate Loans

  • Loan Amount: $250K-$5MM
  • Loan Purpose: Purchase, Cash-Out, Refinance
  • Loan Product: 5-Year and 7-Year Hybrid
  • Rates: 6-9%
  • Amortization: 20, 25, 30
  • Eligible Markets: Top 200 MSAs
  • Eligible Borrowers: U.S. Citizens, Permanent Resident Aliens, Legal Entities
  • Index: Wall Street Journal Prime Rate
  • Property Types Tier I: Multifamily And Mixed-Use (Residential)
  • Property Types Tier II: Mixed-Use (Commercial), Office, Retail, Light Industrial, Self-Storage, Warehouse, Automotive, Mobile Home Park, Daycare Center, Restaurant, Bar
  • Standard Prepayment Fees: 5% For First 3 Years

Up to 80% LTV on multifamily properties and this includes cash-out transactions

Borrower does not document income on tax returns, investor and owner-occupied

Recently stabilized – we only need 75% economic occupancy for the preceding 90 days at a 1.2 DSCR

No seasoning on title and the ability to use appraised value vs cost basis

Out of state investors

Markets with higher CAP rates

[1] Rates based on LTV, term, amortization, property type, and borrower’s credit.

[2] Legal entities include corporations, LLCs, partnerships, and trusts with majority ownership by U.S. citizen or permanent resident alien. All principals with minimum 25% ownership interest must personally guarantee loan.

[3] 10% LTV deduction for NY.

[4] In no event can the interest rate be below 6%. [

[5] Loans are assumable upon Silver Hill approval.

[6] Multifamily and Mobile Home Parks do not apply to Stated Owner-Occupied program

[7] Max 2 points in YSP for loans $500,000 or less.

[8] Minimum middle credit score for Stated Owner-Occupied is 700.

[9] For Stated Owner-Occupied Program: Guarantor(s) are not required to provide personal or business tax returns to qualify for this program. Guarantor(s) may be eligible for a different loan program with more favorable terms if verifiable documentation such as personal and/or business tax returns are provided.

 

 

Solutions-Based Hard Money Commercial Lending
* No Financials Required
* All Credit History Accepted
* Up to 65% loan-to-value (LTV) Ratio
* 50% loan-to-value (LTV) on Improved Land
* Competitive Rates
* Loan Amounts from $250K – $5 Million*
* No Loan Committees

Type of Commercial Real Estate properties We Fund:
* 1-4 Family Investment / Non-Owner Occupied (NOO)^
* Multifamily (Apartment Building)
* Office Building
* Mixed-Use
* Retail
* Strip Center
* Free Standing Commercial
* Warehouse
* Light Industrial **
* Self-Storage **
* Improved Land

 

 

Commercial Income Producing Real Estate Loans

PURPOSE:

Fixed-Rate financing on income-producing properties

GEOGRAPHY: The Continental United States

LOAN SIZE: $ 1, 000,000 to $ 20 ,000,000

PROPERTY TYPES: Multifamily, Manufactured Home Communities, Office, Industrial, R&D Flex, Retail, Self-Storage ( other asset classes considered on a case-by-case basis)

TERM: 1 to 3 years

AMORTIZATION: None; Interest-Only

INTEREST RATES: Pricing is based on transaction quality, location and leverage.

Rates are typically 7.75% – 9.75 %

PAYMENTS: Payments calculated on an interest-only basis and made via auto-debit from borrower’s account

LOAN- TO-APPRAISED – VALUE: Up to 75%

MINIMUM DSCR: 1.05x (without interest reserve)

LIABILITY: Recourse and Non-recourse offered

LOAN FEES: 2%

PREPAYMENT: Typically a minimum of 6 – 12 month ‘s interest will be charged

SECONDARY FINANCING: Not allowed

OTHER COSTS: Generally $10,000 – $15,000, plus legal


 

SBA  Loans

 

Maximum Advance Rate 75% of cost or 70% of stabilized value. For SBA eligible projects, up to 80% of eligible project costs.
Loan Size $1,000,000 to $15,000,000
Loan Term 6 months to 36 months – Interest Only
Collateral 1st Mortgage or Deed of Trust on land and improvements held fee simple interest
Stabilized NOI

Minimum Debt Yield 10.0% for Office, Industrial and Retail Properties
12.75% for Hotels, Assisted Living and other Single-purpose Properties
DSCR 1.30x for properties < 10 years old
1.40x for properties > 10 years old
Recourse Partial or Full Recourse
Ownership Experience Minimum 3 years of comparable ownership and management experience demonstrating successful (profitable) operations.
Preferred Property Characteristics for Hotel Loans 
  • Interior Corridor
  • Limited Service or Select Service
  • < 20 years old
  • Midscale or Upper Midscale Class Franchise
  • Located in an economically diverse community with a population > 50,000

 

Construction Loans
Maximum Advance Rate 70% – 85% of cost
Contingency 10% contingency and interest reserve must be accounted for in the project cost.
Post-Closing Liquidity 5-10% of total loan amount (1st+ 2nd mortgage amount), available upon completion of construction.
Third Party Cost Review Borrower must agree to third-party cost review, contractor evaluation report, and third-party fund monitoring during construction. All related costs may be included in project cost.
Performance Bond Borrower may be asked to provide performance bond from their contractor. Subject to third-party review of contractor.
SBA Eligibility The borrower must be eligible under the SBA 504 or SBA 504 Green Loan initiative programs.
Maximum LTV For 1st Trust Deed

Multi-Purpose 50% – 55% (Maximum LTV – Up to 90% on total project cost)
Hospitality & Special Purpose 50% – 55% (Maximum LTV – Up to 85% on total project cost)
Cash Collateral(May Be Required) Additional cash collateral equivalent to 5% to 10% of the total project cost may be required during the construction phase if the Borrower and Guarantors do not meet the Global Debt Service Coverage Ratio requirements (0.50x-1.00x from surplus cashflow). Cash Collateral will generally be released upon completion of construction and issuance of the SBA 504 debenture.
Additional Hospitality Requirements Midscale or upper midscale limited-service or select-service franchises only. Property must be located in an economically diverse community with a population >50,000.

 

 

SBA 504 Loans
Maximum Loan Amount $25,000,000 – 1st Mortgage / Trust Deed Loan Amount
Minimum
Debt Service
Coverage Ratio
Multi-Purpose – 1.10x

Hospitality – 1.20x

Special Purpose – 1.25x

Minimum Global Debt Service Coverage Ratio 1.25x+
Post-Closing Liquidity 5% of total loan amount (1st + 2nd mortgage amount)
Full Recourse Yes (with Personal Guarantees)
Minimum FICO Score  650
Ownership Experience Two years minimum ownership experience demonstrating successful (profitable) operation of same business.
Maximum LTV For 1st Trust Deed

Multi-Purpose 50% – 55% (Maximum LTV – Up to 90% on total project cost)
Hospitality & Special Purpose 50% – 55% (Maximum LTV – Up to 85% on total project cost)

 

Hard Money (Fix and FLip)

Loan Size: $500k to $12mm

Property Types:

High End Non-Owner Occupied Single Family Residences

Multi Family

Office Buildings

Strip Centers

Mixed Use

Hotels & Motels (Flagged)

Industrial Warehouses

Self-Storage

Skilled Living and Assisted Living

Loan Types:

Purchase Money & Refinance Transactions

Cash Out for Business Purposes

Discounted Note Payoffs

Rehab… Construction Completion & Property conversion

Loan Terms range from:

$500,000 to $12 mil

1 to 2 years Interest only

9% to 11%

2 to 3 Lender points

Up to 65% Loan to value (LTV)

Up to 80% Loan to Purchase maxed out at 65% Loan to Value (LTV)

*Rehab based on After Repair Value” (ARV)

*NO Pre-Pay

The better the deal/The better the pricing

*California rates start at 7.99% and points start at 1.5%

Pricing Factors:

Term… the shorter the term the better the pricing

LTV… the lower the LTV the better the pricing

Property Location and Condition… A-properties in A-locations get better pricing then B-

properties in B-locations & B-properties in B-locations get better pricing than C-properties in C-locations

Servicing capabilities… borrowers who can service their own debt get better pricing then borrowers asking for reserves

Exit Strategy… the better the exit strategy the better the deal

Primary Loan Requirements:

1. 65% LTV or up to 80% Loan to Purchase

(maxed out at 65% LTV)

2. Borrower/Property with the ability to Service our interest only debt

3. Clear Exit Strategy from our loan

*On Fix and Flips we are now 75% purchase and 100% Rehab… as long as the total loan amount is 65% or less of the “After Repair Value” (ARV)

 

 

Equity Based Loans
YOUR PROGRAM HIGHLIGHTS

We offer fast equity-based loans to borrowers who can’t qualify for a bank loan or who simply need capital fast. All loans are secured by commercial and residential properties.

Commercial: Multi-Family 5+ Units / Apartment Buildings, Office, Retail, Industrial, Mixed-Use, Special Purpose, AG, Land

Residential: Single Family Residences, Multi-Family 2-4 Units, Condos, Town-homes, Construction, Land, Development

Exceptions: We will lend on all property types and all property conditions. All property locations will be reviewed.

NO FICO Score Requirements, Bad Fico Ok

  • NO Tax Returns, No Doc, Stated Options
  • NO Debt-to-Income Ratio Requirements
  • NO Debt Service Coverage Ratio Requirements
  • NO Financials, No 4506, All Property Uses
  • NO Red Tape “Make Sense Underwriting”
  • All Property Types, All Property Conditions
  • Self Employed Borrowers, Wage, No Doc
  • Stated Income Loans
  • Recent Foreclosure or Short Sale or BK Ok
  • Individuals, Trusts, Foreign Nationals, Corp LLC
  • 1st & 2nd Mortgages, Cross Collateral
  • Business Purpose and Commercial Use Only
  • No Seasoning Requirements Title or Funds
  • Purchase, Refinance, Cash-Out Equity, Mezzanine
  • Residential & Commercial & Industrial & AG/Land

No Income Verification

·30 year fully amortized loans with no verification of income!

·75% LTV on multifamily/mixed use, up to 75% LTV on 1-4’s and commercial type 2

·30 year fully amortized loans with no verification of income!

·Loan Amounts to $2MM on SFR 1-4 Properties (Including Condos)

·Loan Amounts to $5MM on Commercial Type 1 (Apartment Complexes) and Type 2 (Regular Commercial)

·3Y and 8Y ARMs – NO BALLOON

·Interest Rates as low as 6.75% (w/ Buydown)

·Funding to Foreign Nationals

·Funding to LLC’s and Corporations

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