February 15, 2018
By Terry Painter, Mortgage Banker
Member of the Forbes Real Estate Council
Commercial real estate loans differ in so many ways from residential loans. It is a different world, or you could say "a different planet.” Here are some differences:
1. On a historical basis, commercial loans have been done with concern to the property first and foremost. And... more
In Short, it takes these 5 components to finance an Apartment Building:
1. A Great Property – that has 2 or more of these upsides: a good location, under market rents, already cash flows the loan, or rents can be increased with inexpensive value adds.
2. The Property Value and Income Supports the Loan
3. The Property is in Good Condition
4. The Borrower is Qualified – has good credit, enough cash, and enough net-worth
5. The Borrower has the Best Professionals
December 29, 2017
So you're applying for a commercial real estate loan and you are told "this is a Recourse Loan." What is recourse? Is this good or bad? Does this matter? Do you have a choice? Yes, it does matter. Often borrowers do not realize when they apply for an investment property or business loan, that if they default on the loan they can lose more than the real estate or equipment that is collateralizing the financing.... more
December 15, 2017
By Terry Painter, Mortgage Banker
Member of the Forbes Real Estate Council
At Apartment Loan Store, some of our funds for permanent and bridge loans for financing apartment buildings come from REITS. These loans have great rates and reasonable terms with one to 10 year fixed rates and usually a 25 – 30 year amortization.
REIT stands for Real Estate Investment Trust.... more
December 12, 2017
By Terry Painter, Mortgage Banker
Member of the Forbes Real Estate Council
What is debt service ratio (DSR)? Well, let us start out by saying that although Debt Service Ratio is used more than half of the time by bankers, mortgage brokers and realtors, the correct term is Debt Service Coverage Ratio (DSCR). When you apply for a commercial mortgage, the DSCR is the most important calculation... more
December 6, 2017
By Terry Painter, Mortgage Banker
Member of the Forbes Real Estate Council
Author: The Encyclopedia of Commercial Real Estate Advice – a WILEY book – OUT NOW!
What is Yield Maintenance? Why is it so difficult to get a straight answer on this?
So imagine you are taking out a commercial loan and you’re told that the prepayment penalty is yield... more
October 18, 2017
Commercial Real Estate – The Hidden Trap That Turns Your Investment Into a Las Vegas Crapshoot
There is a hidden trap that many commercial real estate investors are not aware of. Not being aware of it will quite possibly cause them to experience big monetary loss.
A substantial number of commercial real estate investors will try to get the biggest loans possible to acquire... more
September 19, 2017
What originally prompted me to write on this subject? In one year, we had two of our investors report to us that their property managers stole money from them. I was shocked, and wanted to warn investors to be sure to manage their property managers.
Nearly always, your business is more important to you than it is for someone else who is not an owner. You have more at... more
September 6, 2017
Many inexperienced people think that commercial real-estate investment is just a passive investment – you just sit back and collect lots of money.
Nothing could be further from the truth. Do you just sit back and collect money passively if you run a restaurant? No! There is a lot of work. The management, managing your managers, customers, customer service, legal, marketing, repair,... more
August 30, 2017
If you have money to invest, read this article. Why? It tells you a number of reasons for commercial Real-Estate being a great investment. Some think it’s the number one investment of all investments.
Let’s get right to it:
1. The Power of Leverage –
*So many commercial Real-Estate properties have multiple units in one location (For example – apartment buildings). Think about... more
Have you developed a similar size project in the past 10 years, or several projects combined that equal the size of the project to be developed or do you have the ability to bring in a partner who has this experience?
