Apartment Lending

Apartment loans remains one of the bright spots in the field of commercial mortgages, and borrowers can still expect long-term, fixed rate financing, leverage loans and low rates.

For example, we still see 30 to 35 years of fixed rate financing, if 5 and 10 year fixed rate is more popular with borrowers. Amortization schedules are 30 to 35 years with certain government programs supported. Regarding leverage, the borrower may still be 80% financing on purchases (85% on the loan application over $ 3,000,000) and 75% on cash refinancing. The prices are strong as well with most in the 6% - range 6.25% (2/10/09) rates for larger loans in 5% s "are available.

Apartment Loan Multifamily Loan

What bad news? Conventional financing is limited and multifamily lending is more conservative in a global perspective. Historically multifamily underwriting has been focused almost exclusively on the subject property. But the apartment is ready for more, such as commercial mortgages in general, where all borrowers financial situation is reviewed.

Serving the needs of borrowers will be considered personal, other companies will often viewed, etc. to ensure that the funds to the borrower the overall flow. (Keep in mind that some programs where loan amounts are $ 3,000,000, the borrower is not personally looked at.) Such insurance is often heavy overall for borrowers who are not used for this operation, but this is the new reality and borrowers should be prepared to "play the game" if they want to recoup their multifamily properties financed.

Overall, despite recent changes, housing loans remains one of the most profitable sectors of the business. But above all, liquidity is always there with words that still make sense for borrowers. Borrowers should be prepared to provide more documentation than is the use, but compared to other areas where funding is almost gone, it looks really good.