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Purchase and Rate Term: Below $5,000,000 - No Cash-Out
There are 14 different loan programs to choose from. The following are just general terms.
- Property Type - Multifamily with 5 or more units: office, retail, industrial, office warehouse
- Ineligible Property - No rehab, turnarounds or handyman specials
- Transaction - Purchase, refinance rate-and-term
- Ownership - Most entities, corporation, LLC, LLP or individuals
- Credit - Borrower must have "A" credit, no mortgage lates
- Loan - Amounts $500,000 to $4,999,999
- Loan-to -Value - Purchase: 80% LTV. Refinance: No cast out 80%
- Second Mortgage - Second mortgages not allowed
- Amortization & Terms - Up to 30 years amortized. Initial fixed for a period of 3 years, 5years, 7 years, 10 years. At the end of initial fixed period loan converts to a 1 year adjustable using the 1-year LIBOR as the index plus margin.
- Interest - Rate caps 2% annual; 6% life
- Rate Lock - At time of submission (at time of registration for 60 days with deposit of$500 which will be credited at close)
- Escrow - Depends on loan program selected
- Recourse - Depends on loan program selected
- Seasoning - Generally do not allow refinancing during the first 6 months of ownership
- Appraisal - The appraiser must be state-licensed
- Survey - Survey required if not otherwise satisfactory to Title Company
- Inspection - Depends on loan program selected
- Environmental - Depends on program selected
- Title Insurance - ALTA lender's title insurance satisfactory to lender
- Termite - Termite report satisfactory to lender. Infestation can be treated before closing or up to 60 days after with a 125% holdback.
- Other Costs - The borrower will be responsible for paying all costs associated with the transaction including, but not limited to: appraisal, survey, title insurance, credit reports, property condition inspection, flood insurance and legal fees if required.
- DSCR ( Debt Service Coverage Ratio) - 1.20:1. Determined by dividing actual NOI by Debt Service (PI). This is the minimum acceptable. Some loans will require higher DSCR..
- NOI (Net Operating Income) - This is the net profit after all property related expenses have been paid excluding the debt service payment (mortgage PI payment).
- Vacancy - Market
- Management - Use greater of market or 5% of EGI as a management fee expense for underwriting
- Replacement Reserves - As a minimum use 150-$200 per unit for any replacement reserve for underwriting. (Can be adjusted downward if operating statements show repairs and maintenance items).
- Assumable - Qualifying assumptions with a 1% fee
- Prepayment - Depends on loan program selected
Purchase and Rate Term: $5,000,000 and Above - No Cash-Out
There are 25 different loan programs to pick from. The following are just general terms.
- Property Type - Multifamily, office, office/warehouse, retail, mini-storage
- Ineligible Property - No rehab, turnarounds or handyman specials
- Transaction - Purchase, refinance rate-and-term
- Ownership - Most entities, corporation, LLC, LLP or individuals
- Credit - Borrower must have "A" credit (FICO of 650 or better)
- Loan - Amounts $5,000,000, to $100,000,000
- Loan-to-Value - Purchase: 80% LTV. Refinance: No cash out 80% LTV
- Second Mortgage - Second mortgages not allowed
- Amortization & Terms - Up to 30 years amortized. Initial fixed for a period of 5 years - 30 years.
- Interest - Depends on loan program selected
- Rate Lock - At time of submission (at time of registration for 90 days with deposit on1% - 2% of loan amount which will be credited at close)
- Escrow - Depends on loan program selected
- Recourse - No
- Seasoning - Generally do not allow refinancing during the first 12 months of ownership
- Appraisal - The appraiser must be state-licensed
- Survey - Survey required if not otherwise satisfactory to Title Company
- Inspection - Depends on loan program selected
- Environmental - Phase I
- Title Insurance - ALTA lender's title insurance satisfactory to lender
- Termite - Termite report satisfactory to lender. Infestation can be treated before closing or up to 60 days after with a 125% holdback
- Other Cost - The borrower will be responsible for paying all costs associated with the transaction including, but not limited to: appraisal, survey, title insurance, credit reports, property condition inspection, flood insurance and legal fees if required.
- DSCR (Debt Service Coverage Ratio) - 1.20:1 Determined by dividing actual NOI by Debt Service )PI). This is the minimum acceptable. Some loans will require higher DSCR.
- NOI (Net Operating Income) - This is the net profit after all property related expenses has been paid excluding the debt service payment (mortgage PI payment)
- Vacancy - Market
- Management - Use greater of, market or 5% of EGI as a management fee expense for underwriting
- Replacement Reserves - As a minimum use $150-200 per unit for any replacement reserve for underwriting. (Can be adjusted downward if operating statements show repairs and maintenance items).
- Assumable - Qualifying assumptions with a 1% fee
- Pre-payment Penalty - Depends on loan program selected.
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