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Securing Loan with Commercial Real Estate
Posted on 3/21/13 at 6:02 pm
Posted on 3/21/13 at 6:02 pm
Does anybody know how willing banks are to secure loans to buy commercial real estate with the real estate itself? What kind of guarantees might they need? What if the commercial real estate has a lease already on it?
Any help would be great. Thanks.
Any help would be great. Thanks.
Posted on 3/21/13 at 6:22 pm to ShreveportTIGER318
This is very general but
A 1.4 dcr
25 percent down
YmMV
A 1.4 dcr
25 percent down
YmMV
This post was edited on 3/21/13 at 6:25 pm
Posted on 3/22/13 at 9:44 am to ShreveportTIGER318
If it is free and clear and has a lease that supports the expenses, it should not be a problem. If it isn't free and clear, then you probably need at least 30% equity including the cash out. Try the smaller banks and homesteads.
Posted on 3/22/13 at 9:47 am to ShreveportTIGER318
quote:The short answer to your question is banks do it every business day.
Does anybody know how willing banks are to secure loans to buy commercial real estate with the real estate itself?
Posted on 3/23/13 at 1:47 pm to LSURussian
Ive never financed commercial real estate. Family has quite a bit for people that aren't really in the business. I am trying to push them to leverage the property we own now to acquire more property, or just take out a loan and secure it with the property. That way we won't have to have a capital call or use up the rent from the other properties. Right now, it has just been passed down with the generations without much enthusiasm for growing it and as an heir, I would like to see that change.
Posted on 3/23/13 at 1:53 pm to ShreveportTIGER318
quote:
ve never financed commercial real estate. Family has quite a bit for people that aren't really in the business. I am trying to push them to leverage the property we own now to acquire more property, or just take out a loan and secure it with the property. That way we won't have to have a capital call or use up the rent from the other properties. Right now, it has just been passed down with the generations without much enthusiasm for growing it and as an heir, I would like to see that change.
I am in your exact position right now. I am in talks with 3 banks at the moment and awaiting financing structure and rates. We have almost 100 percent equity in the properties and at the rates offered today it would be a shame not to act, which is why I am doing this right now. I am concerned about easing cash flow, so leveraging and expanding the properties at this interest rate makes too much sense at the moment. I will let you know what I turn up in financing as far as rates.
Posted on 3/23/13 at 2:06 pm to ShreveportTIGER318
quote:
Does anybody know how willing banks are to secure loans to buy commercial real estate with the real estate itself? What kind of guarantees might they need? What if the commercial real estate has a lease already on it?
Any help would be great. Thanks.
As Russian said...every damn day.
If the property is held in a corporate name then you(and any other principals) are going to be expected to guarantee the debt.
A long-term lease to a strong tenant that provides a comfortable dscr would definitely be a plus.
What type of property is this?
This post was edited on 3/23/13 at 2:09 pm
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