First, Get the Term Sheet!

Just about all commercial real estate transactions today involve high ticketed items such as appraisals and environmental reports. An investor looking for financing should prepare himself for such expenses even in cases where older reports are available. On the other hand the lender cannot fully approve the loan unless these expensive “conditions” are satisfactory. So, what does a borrower do in such case? No one, no matter how well off he is, would – or should – be willing to waste thousands of dollars on third party reports before he has some peace of mind his deal stands a chance to close.

The answer is a Term Sheet. In commercial lending this is the term typically used for a conditional commitment. It is a written expression of interest by the lender to finance a commercial deal in which the estimated terms and cost of the loan are itemized. It is not a final commitment but a borrower receiving a Term Sheet implies the commercial lender likes the deal and is willing to close on it provided the third party reports are satisfactory.

If you are a borrower or working with a borrower on a commercial deal be sure to get a Term Sheet before spending money on high priced reports.

And speaking of Term Sheets we just secured bank term sheets on the following deals… and we can do the same for you or your client (that’s if your deal qualifies, of course)…

1. SBA refinance of a Dollar Store

* Saving the client 5g/month by paying off high-interest debt through and replacing his existing note with a lower interest note that is amortized over 25 years
* Rate 6%
* 80% LTV
* Loan amount of $700,000

2. 32-unit multifamily refinance

* Borrowers are Canadians and will realize a sizable monthly savings by replacing their private note with a long term note
* 6.25% 10 year fixed amortized over 25 years
* 80% LTV
* Loan provides for capital improvements on top of the refinancing of the note
* Loan amount $750,000

3. 150-unit multifamily refinance

* Client will realize a significant savings by replacing his current bank note with a lower interest Fannie Mae loan
* New fixed rate of 4.9% amortized over 30 years
* Non-recourse
* Loan amount $2,500,000

4. Factoring for a Wyoming Oil service company

* Line of Credit $250,000
* 1.5% monthly rate

Contact us to see if your transaction qualifies for financing.


One thought on “First, Get the Term Sheet!

  1. Pingback: Financing Apartment Buildings « Commercial Finance

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