Helpful Terms for Commercial Loans
A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z
A
Active Principal
HUD considers an active principal to be a person who is in the role of a consultant who has the expertise and experience that the borrower might be lacking to ensure quality management or completion of the project. The active…
Pros
Cons
1. Getting the Rent on Time
1. In Bed with the Government
2. Lowest Vacancy Rates
2. Annual Inspections Costly
3. Unit Must be Maintained
3. 1st Rent Payment Delayed
4. Higher Rents
4. Damage Payments Delayed
5. Pre-Screened Tenants
5. No Security Deposit
6. Unit Inspected – Declared Safe
6. Tenants Need Mothering
By Terry Painter/Mortgage Banker,…
By Terry Painter/ Mortgage Banker
Member of Forbes Real Estate Council Author of "Encyclopedia of Commercial Real Estate Advice" – Released May 2020
What is flex space? Flex space is industrial space that starts with non-air conditioned warehouse space in the back and an office or showroom in the front. You have the flexibility to “flex” with putting small or larger spaces…
By Terry Painter, Mortgage Banker
Member of the Forbes Real Estate Council
What is a master lease? What are the benefits and how is it used?
A Master Lease as it pertains to commercial real estate is a financial instrument that allows a buyer/lessee to lease the property with an option to purchase it at a later date. The lessee has equitable title, not legal title which allows the…
By Terry Painter, Mortgage Banker
Member of the Forbes Real Estate Council
First, let’s define what a capital stack is. Pertaining to commercial real estate, a capital stack refers to the differing layers of money resources that are involved in buying and improving a project having to do with real estate. The differing layers have to do with the amount of risk in the investment end…
By Terry Painter, Mortgage Banker
Member of the Forbes Real Estate Council
What is the difference between a non-recourse loan and a recourse loan, and which is best for you?
A Non-Recourse Loan is made to a single asset ownership entity like an LLC. If the property fails, the lenders only recourse is to take the property back. A Recourse Loan is made to an individual(s)…
With a non-recourse loan, no personal guarantees are required. In the case of a default, the lender can only take possession of the subject property. Thus, the borrower’s personal assets are not at risk.
Why You Should Join the Non-Recourse Loan Club?
Congratulations! If you are reading this and wanting to learn more about non-recourse financing, then you have the opportunity to…
A rent concession is a discount in the rent used by property management companies to influence prospective tenants to lease a rental property when rental unit supply is larger than rental unit demand.
In your neck of the woods, rent concessions are minimal due less than 5 percent vacancy. To get absorption going quickly, some larger, just built apartment complexes are offering a half month’s…
May 2025 Cap Rate Report
Cap Rates Slightly Compressing, Office Properties Still Losing Value
May 15, 2025
Multifamily
According to Marcus and Millichap, Multifamily Cap rates compressed 7 basis points (bps) during the first quarter of 2025. This trend is expected to continue at least through Q3 of 2025. According to CBRE, Multifamily cap rates on value add…
Cash on Cash Return is the percentage of annual income your cash investment earns on a real estate investment after debt service. When it comes to investing, the ratio of the cash-on-cash return is defined as the before tax annual cash flow or net operating income divided by the whole amount of money invested, put as a percentage.
Don’t Fall Into the Cash on Cash Return Trap
You might as well…
A bridge loan is a temporary real estate loan with a term of 12 to 36 months for the purpose of quick acquisition, rehab, or repositioning a property. A non-recourse bridge loan is most desirable in that no personal guarantees are required and thus the borrower’s personal assets are not at risk.
The Danger of Recourse Bridge Loans and the Death in Unit 146B
If you are reading this,…
The down payment required for a commercial construction loan ranges from 10% for SBA, 15% for HUD Loans and up to 30% for commercial banks, life companies, and private lenders. Your equity in the land if you have owned it for more than 2 years may be applied at fair market value towards the down payment.
Five Key Factors for a Commercial Construction Loan Down Payment
1. …
HUD/FHA Apartment Loan Rates
Term
Fixed Rate
LTV
Amortization
Green
35 Years
5.39%
85%
35 Years
Standard
35 Years
5.74%
85%
35 Years
With the lowest long-term apartment loan rates fixed for 35 years, with a 35 year amortization this is by far our best Apartment Loan Program in the United…
Apartment Loan Store has been providing low rate commercial loans in your area since 1997. Do you want a 30 year fixed rate mortgage with a 30-year amortization? Well, we have that. An interest only loan? Yes, we can do that. A bridge loan to acquire a property that needs rehab so you can fix and flip? Well, we have that too. Do you own a piece of land that you want to build an apartment…
Are you interested in a low rate 10-year interest only Mortgage? Apartment Loan Store has one of the best interest only permanent loan programs in your area. Please call one of our friendly loan specialists to find out more. We can also arrange an interest only bridge loan for you to renovate a property. For what purpose would a real estate investor want an interest only loan? The purpose is to…
Apartment Loan Store has some of the lowest bridge loan rates in your area. We have had a specialty in Bridge Financing since 1997. The term of our bridge loans is between one and two years and for some projects up to three years. Our funds come from Hedge Funds, REIT’s, and private money investment funds.
We have great rates starting at 5.75% for experienced borrowers with stellar…
At Apartment Loan Store, we have five bridge or hard money loans to choose from in your area. In fact we call some of our hard money loan programs soft money loans, or medium hard money financing. Our hard money rates start at 6.50% and go up to 12.0%.
You may be wondering what is a hard money commercial bridge loan? How are hard money bridge loans different from traditional or…
Since 1997, Apartment Loan Store has specialized in non-recourse commercial lending and non-recourse construction loan financing nationally. We have non-recourse loans available in your market. Call us to discuss which non-recourse loan program is right for your development.
If you have tried getting a national, regional or community bank to do non-recourse you have likely gotten an…
Check out our complete guide to HUD Multifamily Loans
For our current HUD loan rates and programs HUD Loan Rates
Started in 1965, HUD is a department of the United States federal government. Its full name is The Department of Housing and Urban Development. HUD has many roles. One of the main purposes of HUD is to create more quality and affordable housing in America. In…
When you are shopping to buy a commercial investment property, you first look at the purchase price, then the quality of the property. Lastly, like most investors you examine the net income of the property - this is what really determines if it is worth the purchase price. The Income Approach to Valuation does the same thing. It is without question the most important method that commercial…
CLOSING 97% OF OUR MULTIFAMILY LOANS AS PROPOSED
Getting the right loan and the lowest rate requires wisdom and finesse. If you’re ready to partner with a team of professionals who’ve built a foundation on straight talk and true strategy, we are the loan store for you.
26+ YEARS OF OVER-DELIVERING VALUE.
HUD Loans are one of the best options with the current level of interest rates. For a complete guide to HUD Multifamily Loans please go here: