100 mortgage broker

100 mortgage broker
Have a few questions regarding a commercial mortgage refinance? Hardly are the typical questions we are asked on a daily basis.

Timing - it is really 30 days to close?

No, unfortunately it will probably take longer than 30 days from start to finish to close your loan. 60 days is the norm on an average, if 45 days is feasible. 30 days is generally estimated in the context of banks, brokers and lenders. If someone tells you they can use your loan in 30, they are either a newcomer, or just to retain your loan. Which is of course a very bad way to start the transaction.

Despite the potential of your frustration and anger, why it takes so long, it's better, the process and just as carefully as possible in presenting all the necessary documents from the bank. One of the biggest delays, the borrower is unable or simply dislike plan to establish the necessary elements. All too often feel justified on the borrower that the bank overly conservative or just a thorough. All this does is simply stalls the process. Once applied, banks rarely out necessary documentation.

What are the fees?

They are actually pretty much the same all along the line. It is usually 1% custodian fees, often lenders will charge a processing fee in the amount of approximately $ 1000, assessments in the area cost of $ 2,000 - $ 5,000 (if it is not unusual to see assessments more like $ 10,000 or more larger, special use properties), title of $ 800 - $ 2000 again depending on the loan amount / state, and a phase of an environmental report costs about $ 1,500 - $ 2,000. Some properties such as multi-family homes is usually not to the environment or fees, if they will do an environmental survey, which cost approximately $ 800.

What can I expect for the loan programs?

It extends far beyond that ever. Depreciation periods from 15 to 30 years, fixed periods of floating up to 30 years, stated income, .8 dcr minimum required, 90% financing, etc. So, it pays for the borrower to note that banks can use the same loan program, but roll it in several ways. For example, 99% of banks offer the SBA 7a loan as floating product. However, there are some who so than 5 years, 25 years amortization loans.

What is a prepayment penalties, and can I do with it?

Prepayment penalties are fees that arise when borrowers pay off the loan by either selling the property or refinancing of the debt before the agreed period. The time is usually between 3 -5 years with some CMBS lenders go as long as 10 years. The fee is almost always in the form of a percentage of the loan balance, ie 3 -5% of the loan amount. In other words, if the loan is $ 1,000,000 and the borrower has a 5% pre-pay would cost him 50,000 U.S. dollars to pay off the loan early.

They respect us in the IT, so it is possible if the pool of lenders, which is greatly reduced. It is likely, and that is a presumption, 1 of 100 banks or lenders either victory or to bet more in order to increase the interest to justify the compromise. And I'm on a new loan. If available, you are pretty much plot (if you go to a defeasanse or another borrower to assume your loan). We work with a bank in Virginia, which waives all pre's but their prices are a little high.

What is the application process?

After the borrower agrees to continue with a bank / lender they will be asked when completing an application and the documentation. What is usually required is a personal financial statement, three years of business and personal tax returns, year in the profit and loss statements and year-to-date balances. After a full "scrub" from above, through the takeover, the lender is usually a term sheet, which itemize the offer by the bank. The usually a few pages long and identifies the major issues such as rate, amortization period, etc. minor problems with the course includes a lot of small print protection of the bank. If the borrower wants to move forward they need to sign the letter and write a check to the bank for assessing environmental and sometimes charge a handling fee.

At this point, the loan is officially underway. The lender will an insurer be thoroughly reviewed and the funding request is a list of additional needs required documents beyond what they already have. The third party reports will also be ordered at this point. Once the needs list has been fulfilled and all third parties in the bank is officially the loan (or not) and a time to close.

It is a good idea for the borrower to be patient and the Bank as thoroughly as possible with their provisional admission, so you do not waste your time and money for third party reports, since it can be difficult to create a "refund".

248 885-8797 Jeff Rauth is President of Commercial Finance Advisors, Inc. of Birmingham, Michigan. He specializes in commercial real estate loans between $ 300,000 - $ 5,000,000. Offers unique loan programs such as second mortgages, commercial 30 years fixed and 90% non SBA financing and Commercial Equity Lines. 248 885-8797