| Loan Amount: |
$1,000,000 and larger |
| Loan Term: |
7 to 10 year balloon and 15 year self-amortizing terms |
| Amortization: |
Up to 30 years |
| Prepayment: |
Typically, a 3 year lock out period, followed by a yield maintenance formula or defeasance option |
| Recourse: |
Non-recourse, except for standard lender carveouts (e.g. fraud, misapplication of funds, waste, property taxes, and environmental issues) |
| Borrower: |
All properties must be owned by a single asset or single purpose entity |
| Debt Service Coverage: |
Minimum 140% |
| Reserve Replacement: |
A minimum Replacement Reserve Escrow for the property will be required at an amount equal to 5% of the effective annual gross revenue. This interest earning escrow will be funded at closing and on an ongoing monthly basis. The borrower may request withdrawals of funds on a monthly basis to replace FF&E and other capital expenditures. |
| Loan to Value: |
Up to 70% loan to value |
| Subordinate Financing: |
Prohibited |
| Occupancy: |
60% minimum average historical occupancy rate |
| Assumability: |
Yes, one time to a qualified buyer approved by Lender for a 1% assumption fee and out-of-pocket costs |
| Escrows: |
Required for taxes, insurance and replacement reserves. An additional escrow may be required to as determined by the engineer’s report. |
| Rate Lock: |
Available upon receipt of complete application, subject to borrower qualification. |
| Loan Costs: |
The borrower is responsible for all legal and third party expenses. |
| Processing Deposit: |
Approximately $20,000 or other such amount determined by the lender to cover the costs of all third party reports (including environmental, building condition and appraisal), travel expenses and other out-of-pocket expenses |
| Financing Fees: |
1% of the loan amount, payable upon acceptance of loan commitment |
| Processing Time: |
Typically 45-60 days after receipt of all required due diligence documentation |
| Underwriting Requirement: |
All final submissions must include an Argus Valuation-DCF data file. If you have not modeled your submitted project in Argus Valuation-DCF, you must engage us or a third party to model your project. However, on a preliminary basis, please feel free to submit your proforma in any format. |
