RPP - Financing Using CMBS & Private Lenders with Nick Chapman
Dylan Marma and Mike Taravella interview Rand Capital’s Nick Chapman to discuss Fannie and Freddie’s lending limits for 2019 and the uptick in alternative funding sources. These alternative funding sources are CMBS and Private Lenders. CMBS: Very common funding source for office space, but becoming more common in the multifamily space Minimum Loan Amount: $3M Loan-To-Value (LTV): 75% Can have higher LTV by leveraging mezzanine debt (85%) Loan Term: 5 and 10 year terms 30 year amortization Less flexible compared to Fannie & Freddie Similar requirements to Fannie & Freddie when it comes to closing Closes just as quickly as agency and in many cases faster Fixed Rates, which are based on Swap Rates Application Fee is $45,000 But you do receive most of that back regarding Potential for Full-Term Interest Only Mortgage at 65% LTV - From 1-3 yrs at a higher leverage to full term I/O at 65% LTV Private Lenders: Nondepository bank that is privately held Minimum Loan Amount: $1M Loan-To-Value (LTV): 75% Can have higher LTV by leveraging mezzanine debt (85%) Loan Term: 5 and 10 year terms 30 year amortization Nonrecourse Closing Time: 30-60 days depending on complexity of deal Requirements: Net Worth Requirement: 20% of the loan amount Post-Closing Liquidity: 5% of the loan amount ~50% half of what agency debt requires Much more favorable for new investors Attend Multifamily Mastery 3 and use the discount code “RPFAM” for 20% off! Contact Information: Nick Chapman’s Email Rand Capital Website Invest with Rand Partners Follow Us on Linkedin @Randpartners Follow Us on Instagram @Randpartners Follow Us on Facebook @Randpartners
Jake & Gino: Real Estate Investing & Multifamily · Dylan and Jake
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Show Notes
Dylan Marma and Mike Taravella interview Rand Capital’s Nick Chapman to discuss Fannie and Freddie’s lending limits for 2019 and the uptick in alternative funding sources. These alternative funding sources are CMBS and Private Lenders.
- CMBS:
-
- Very common funding source for office space, but becoming more common in the multifamily space
- Minimum Loan Amount: $3M
- Loan-To-Value (LTV): 75%
-
- Can have higher LTV by leveraging mezzanine debt (85%)
- Loan Term:
-
- 5 and 10 year terms
- 30 year amortization
- Less flexible compared to Fannie & Freddie
- Similar requirements to Fannie & Freddie when it comes to closing
- Closes just as quickly as agency and in many cases faster
- Fixed Rates, which are based on Swap Rates
- Application Fee is $45,000
-
- But you do receive most of that back regarding
- Potential for Full-Term Interest Only Mortgage at 65% LTV
-
- - From 1-3 yrs at a higher leverage to full term I/O at 65% LTV
- Private Lenders:
-
- Nondepository bank that is privately held
- Minimum Loan Amount: $1M
- Loan-To-Value (LTV): 75%
-
- Can have higher LTV by leveraging mezzanine debt (85%)
- Loan Term:
-
- 5 and 10 year terms
- 30 year amortization
- Nonrecourse
- Closing Time: 30-60 days depending on complexity of deal
- Requirements:
-
- Net Worth Requirement: 20% of the loan amount
- Post-Closing Liquidity: 5% of the loan amount
-
- ~50% half of what agency debt requires
- Much more favorable for new investors
Attend Multifamily Mastery 3 and use the discount code “RPFAM” for 20% off!
Contact Information:
Invest with Rand Partners
Follow Us on Linkedin @Randpartners
Follow Us on Instagram @Randpartners
Follow Us on Facebook @Randpartners
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About Jake & Gino: Jake & Gino are multifamily investors, operators, and owners who have created a vertically integrated real estate company. They control over $350M in assets under management. Connect with Jake & Gino here --> https://jakeandgino.com.
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