Commercial Mortgages Transform Jan 2007 Update

Commercial Mortgages Transform Jan 2007 Update



Commercial Mortgages Transform - Jan 2018 update
Many commercial lenders have effectively (if not actually) shut their doors .​
For the​ rest of​ us,​ the​ resulting volume is​ so great our appraisal and processing systems are stressed to​ the​ limit .​
Several of​ our competitors are not even taking any more loans just to​ get through the​ current overload in​ their systems .​
We have chosen to​ push through the​ current avalanche of​ loans,​ and will continuing to​ entertain your new loan requests - all while trying to​ keep our rates very competitive .​
What has changed (at least for now,​ and especially on​ larger loans) is​ our desire to​ only look at​ solid apartment and commercial properties,​ with borrowers that add to​ the​ overall strength of​ the​ loan .​
To lessen our processing overload,​ we have temporarily closed the​ tap on​ hotels/motels,​ gas stations,​ owner/user properties,​ environmental issue properties,​ poor-credit borrowers,​ etc .​
This is​ intended to​ help unclog the​ backlog so that your more traditional loans will go through faster.
For loans $3,​000,​000 and above,​ we are going to​ be strictly looking for traditional properties,​ nothing exotic,​ no stories,​ issues,​ or​ moving parts .​
Policy DSCRs and LTVs will be strictly adhered to​ .​
Borrowers will need to​ have average credit scores of​ 680 or​ better,​ their adjusted net worth must be 150% or​ greater than the​ loan amount,​ personal debt ratios cannot exceed 40%,​ etc .​
Loans under $3,​000,​000 have more flexibility in​ all these areas .​
The range of​ acceptable product types is​ greater,​ we will look at​ a​ wider range of​ borrower credit and issues,​ and we can look at​ offsetting strengths and weakness (where we will not in​ larger loans).
Debt Service Coverage Ratios are on​ the​ rise as​ we see the​ economy weaken… 1.20 ratios for residential and 1.25 (or higher) ratios for commercial for the​ time being...
Though I'm not sure for how much longer… we are still offering to​ lock your loan,​ for up to​ 90 days,​ at​ no cost to​ your borrower.
And yes,​ we still offer you​ 1/2% rebate pricing - up to​ $15,​000.00 per transaction .​
I have enclosed our latest rate sheet for your review,​ and I​ will be happy to​ discuss your next transaction .​
On loans over $3,​000,​000 I​ will want to​ see reliable borrower financial data along with your submission - but feel free to​ call to​ discuss the​ transaction even if​ you​ do not have everything in​ hand.
For the​ short term,​ loans can be expected to​ take 60-90 days to​ close .​
We cannot handle any rush transactions for at​ least the​ next 60 days .​
Please let your borrowers all know to​ structure sales with longer closing dates!! If you​ have a​ 1031 exchange,​ make sure all parties can live with the​ reality of​ these closing times .​
The shortage of​ quality lenders with good rates,​ and the​ uncertainty of​ the​ market,​ will pass and the​ market will settle .​
Until then,​ we will try hard to​ meet your financing needs .​
My best wishes to​ you​ for the​ New Year!




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