Your odds of success for getting a commercial property loan approved for a multifamily apartment building , ministorage site , or small retail center will be much higher if your financial contact person is very experienced with commercial lending and has access to numerous lenders .
Technological Advances for Commercial Loans
What if the commercial lending process could be digitized , sped up , and completed on a secure online loan application with just one point of contact ? Your odds of success for getting a commercial property loan approved for a multifamily apartment building , ministorage site , or small retail center will be much higher if your financial contact person is very experienced with commercial lending and has access to numerous lenders .
Commercial loans are somewhat like giant jigsaw puzzles . While the applicant ’ s loan package may not fit the guidelines required at one , two , or 10 different lenders , there are other lenders that have more flexible guidelines which allow lower positive , breakeven , or even negative DSCRs ( Debt Service Coverage Ratios ) with or without income verification . allow lower positive , breakeven , or even negative DSCRs ( Debt Service Coverage Ratios ) with or without income e verification .
Properties with lower positive cash flow or even negative cash flow estimates will likely not qualify at a local community bank or credit union . Yet , they may qualify with other nonbank lenders that do allow breakeven or negative cash flow . Some of our lending partners are assetbased lenders that don ’ t review the applicant ’ s tax returns as well as provide financing for property improvements . These types of incredibly flexible lending guidelines can make the commercial loan application process much easier for the borrower .
An Imploding Financial System and Increasing Bank Restrictions
During the 2008 Credit Crisis ( aka Financial Crisis , Subprime Mortgage Crisis , or Global Financial Crisis ), default risks became more readily apparent as these prominent financial institutions or government entities collapsed and / or were bailed out :
• Bear Stearns : The fifthlargest investment firm in the world that was heavily invested in mortgagebacked securities , collateralized debt obligations ( CDOs ), and other complex securities or derivatives instruments .
• Lehman Brothers : The biggest bankruptcy ever , involving over $ 600 billion in assets .
• Washington Mutual ( WAMU ): Largest bank implosion in US history with almost $ 328 billion in assets .
• FDIC ( Federal Deposit Insurance Corporation ): They only held $ 40 billion in cash reserves at the time of WAMU ’ s collapse , so the government had to silently bail them out to prevent bank runs .
• Countrywide Mortgage : Once America ’ s # 1 residential mortgage lender that almost imploded prior to being bailed out by Bank of America .
• American International Group ( AIG ): They were the world ’ s largest insurance company and were bailed out by the US government , starting with $ 85 billion while growing to more than $ 182 billion several years later .
• Merrill Lynch : The world ’ s largest stock brokerage firm at the time with $ 2.2 trillion under management and 15,000 brokers that was taken over by Bank of America .
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