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Commercial Loan Blog

June 24, 2014

Student housing loans are a specialty that not all commercial lenders prefer. Although they are a type of multifamily housing loan they differ from typical loans on apartment complexes. Student housing loans are not as favored by lenders for the following reasons:

  • They are most often rented by the bed. Although they are in apartment buildings that are comprised of mostly 2 to 4 bedroom units, the leases are usually to individual students. Lenders prefer it when one strong tenant with good credit signs the lease.
  • Students are more likely to have... Read More
  • June 10, 2014

    Over the past weeks, we have shared with you a series of blogs for making sure you do your due diligence when you are choosing a lender for your apartment loans. This holds true for choosing a lender for any type of loan – commercial loans, residential loans, business loans, etc.

    In a nut shell, there is a wide variance in quality of apartment lenders and it is essential that you check them out, especially through talking with references.

    The strongest argument the writer of this blog can find to justify due diligence for a commercial loan, residential... Read More

    June 4, 2014

    Many apartment property investors in their acquisition of apartment loans, end up spreading themselves too thin financially. They put too high a proportion of their finances into one or more apartment buildings. This is especially true of those new to getting commercial loans.

    Their mindset is to purchase as big of an apartment complex as possible in order to make as much money as possible. They see that apartment complex investing is a highly leveraged investment strategy and they want to throw as much money as possible into the biggest loan possible.

    ... Read More

    May 27, 2014

    Recently on this blog, we posted an article about the importance of due diligence when it comes to selecting a company for your apartment loan. The article went into some detail on why due diligence is so important in selecting multifamily lenders, and how to do your due diligence in this key area of commercial loans.

    How well you do your due diligence in selecting the right multifamily lender has a lot to do with the success of your multifamily loan, because the right lender will help you make more money as well as save you time. A poor-quality lender can cause... Read More

    May 22, 2014

    At Apartment Loan Store, we are often asked by our clients about apartment loan qualifications. Keep in mind that owning an apartment building is like owning a business. There are seven apartment loan qualifications that an investor seeking a loan needs to meet today. 
     

    Apartment Loan Qualifications:
     

  • Net Operating Income – Does the apartment complex have positive net operating cash flow to support the loan payments on your desired loan? Preferably at a 1.25 debt service coverage ratio (DCR)? Start by looking at the last full year profit... Read More
  • May 21, 2014

    Doing due diligence on multifamily lenders for multifamily loans has been a topic of this blog a number of times. Today, we are going to look at a very good way to help you do due diligence in your quest for apartment lenders.

    Why? Like anything else in business, you want a company you can trust to do the job you are paying for. And as in anything else, service runs the gamut between superior multifamily lenders and bad multifamily lenders.

    Choosing a superior multifamily lender to do your apartment loan can result in a wonderful, profitable experience.... Read More

    May 15, 2014

    We have all been educated that shopping for a mortgage and getting lenders to compete against each other is smart business. How many lenders do you know or trust? A mortgage broker will know many more than you. This is just one reason for using mortgage brokers. You probably know of a few banks, but do you know their lending criteria? An experienced mortgage broker will know which lenders will get your deal done. Mortgage brokers will also package you and your loan in a proposal that gives you the highest chances of approval. If there is a weakness in your loan a good... Read More

    May 13, 2014

    Apartment property management is a very important part of owning a multifamily property. It is not an easy part of it, however, whether you manage your own property or hire professional management.

    It is a business in and of itself. So if you are new to multifamily investment and have no experience in real-estate property management, think twice about doing your own property management. You need to be skilled in screening applicants, good at handling uncooperative tenants, and know bookkeeping. There are so many stories of properties that failed because of poor... Read More

    May 12, 2014

    A commercial lender makes loans to commercial real estate investors or to a business, but not to an individual. Loans made to individuals are called consumer loans. Real estate loans made to individuals for one to four residential units are consumer loans called residential loans. Commercial lenders usually make loans on properties with five units or more. In most cases, commercial lenders make loans to properties that are zoned commercial.

    Commercial lenders are, foremost, making the loan to an income stream from an investment property or business to service the... Read More

    May 6, 2014

    Quite a few commercial loan investors will, in time, come across the idea of getting a bridge loan or hard money loan. In this article we will focus on bridge and hard money apartment loans.

    An important question to ask yourself is, “Should I get into bridge and hard money apartment financing?”

    First, you need to be sure you know what bridge and hard money apartment financing is used for. Here are some reasons people get bridge and hard money apartment financing:

  • A property doesn’t cash flow enough to qualify for a loan because the occupancy is too... Read More
  • April 30, 2014

    People who are new to real estate investment sometimes find themselves stumped by which type of investment to start out with. Commercial or residential? Keep in mind that an apartment complex (commercial property) is defined as five units and above. Four or fewer units is considered a residential property.

    We recommend that you start with a residential investment, unless you have a large amount of money to invest and you work with an experienced partner. Why should you do this instead of going with an apartment purchase and multifamily loan?

    ... Read More

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