Below are typical issues and required calculations we address for each type of commercial property.

Self Storage Units Financing
Best Rates are associated with: Properties with >1.25 DSCR, <75% LTV, <7% vacancy, appropriate Cap Ex reserves 

• LTV up to 88%
• Occupancy down to 70%
• Amortized to 30 years
• Permanent (Purchase and Refinance) loans from $25 Thousand to $1 Billion
• Construction loans from $250 Thousand to $300 Million
• Bridge loans from $300 Thousand to $1 Billion
• Hard Money
  
  
  

Issues:

• Certain markets have been over built
  
• Higher vacancies are being tied to the overall sluggish economy
  
• Single-story properties are favorable, multi-story properties are adverse
  
• Property management and experience is being scrutinized
  
• Net Cash Flow calculations include Replacement Reserves
  
• Lenders may reconcile property value using the Direct Capitalization Approach on NOI and NCF

General Required Calculations: (we do these calculations for you)

Rent Roll illustrating in-place occupancy and Potential Gross Income

Effective Gross Income - Potential Gross Income minus the greater of underwritten or market vacancy

Net Operating Income - EGI minus operating expenses

Net Cash Flow - NOI minus Capital Expenditures

Debt Service Coverage Ratio - NOI divided by Annual Debt Service

Cap Rate - should be applied to the stabilized income stream to estimate direct capitalized value to support loan request

For Definitions of Commercial property types etc...
(see Commercial Glossary)

  

Commercial property loan rates are at all time low.

March 01, 2006 - National Average on a $1,000,000 loan amount,
amortized at 25 years.

• Fixed rates are based on a 10-Year fixed rate term.
• Fixed rates reflect conduit lenders and
• Variable rates reflect portfolio lenders.

Self Storage Financing Permanent Loan Amounts - $25,000 - $1 Billion

• Fixed Rate Retail Property Loans 5.43 - 8.55%
• Variable Rate Loans for Retail Properties 4.66 - 6.25%
  • Cap Rate 7.9% to 10.2%

Colorado Rates remain below the above National Avg.
See our rate page for all markets effecting rates

Commercial mortgage lenders typically require specific loan level data about a property in order to analyze the underwriting risk, prepare a loan quote, and ultimately fund a loan. Mortgage brokers are a primary source of commercial loan originations today. As a result, lenders' expectations regarding the level of reporting, analysis and overall quality of the origination are increasing.

Unfortunately, there are many brokers who can't obtain financing for commercial properties because they use a residential loan application to submit to lenders
- BIG MISTAKE !

See Example Loan Package Extracts

Unlike Residential financing where the Borrower must qualify for the mortgage product; Commercial financing differs whereby the Property must qualify (not the borrower).

How MTG Brokers Corp. Gets You the Best Rate for Your Commercial Property

Commercial mortgage rates are commonly based on the 10-Year US Treasury yield plus a lender Margin/Spread.
 
The interest Rate Index change is based upon market and trading conditions, while spreads are influenced by loan/property factors - primarily Debt Service Coverage and Loan To Value.
 
Property that demonstrates a high DSCR and low LTV will likely command a lower interest rate.  

MTG addresses DSCR/LTV issues via calculations to analyze reserves, fees and other lender underwriting constraints that can impact a properties Net Cash Flow and therefore, the overall interest rate and loan pricing at the time of your loan origination.
 
This is where others fail to obtain you a lender commitment and why we don’t collect any fees until after an offer is submitted by a lender to you “for your approval”
(Typically, A National, Regional or Colorado Lender You Know and Trust !)
 

Commonly Required Property Data and Format

While loan submission requirements may vary among lenders, most lenders request the inclusion of the following core loan data:

• General property and building description
  
• Current rent roll to reflect lease start/end dates, square footage or unit type, contract rent, rent escalations, reimbursement issues, and estimated market rent
  
• Property income and expense worksheet including calculations for net operating income (NOI) using at least two historical years of income and expense
  
• Calculation and support of normalized net cash flow (NCF) including appropriate reserves based on property type (e.g., vacancy & collection Loss, management, capital expenditures, tenant improvement costs, leasing commission costs (TILC)
  
• Reconciliation of direct capitalized value to purchase price
  
• Loan amount constrained by maximum loan to value (LTV) and debt service coverage ratio (DSCR)

For a Retail Commercial Loan (Click Here)
Construction, Purchase, Refinance, Bridge, Hard Money

Or Visit One of These Pages


Office Building Commercial property Loan Rates and Financing Info.
Office Includes: Central Business District (CBD) Office, Suburban Garden Office, Suburban High Rise Office, Medical Office, Other Office, Doctor Office (for patients requiring bed space - Choose Health Care)

Retail Commercial property Loan Rates and Financing Info.
Retail Properties Include: Grocery, Strip Center, Mall, Outlet Center, and Specialty Center (Car Wash, Golf Course, Auto Repair, Dry Cleaners, Cemeteries.....), etc...

Industrial Warehouse Commercial property Loan Rates and Financing Info.
Industrial and Warehouse include: Warehouse with Office, R & D, Manufacturing, Flex Space, etc...

Multifamily Commercial property Loan Rates and Financing Info.
Multi Family: Apartments, Condos, Townhomes, Military and Student Housing, Community Developments, etc...

Lodging, Hotel, Motel Commercial property Loan Rates and Financing Info.
Hotel Include all Lodging, Motel, Economy, Luxury, Resort, Extended Stay, etc...

Mobile Home Parks Commercial property Loan Rates and Financing Info.
Mobile Home Parks: RV and other Pad rental space

Healthcare Commercial property Loan Rates and Financing Info.
Health Care: Nursing Home, Cognitive Care, Assisted Living, Hospitals, etc...

Self Storage Units Commercial property Loan Rates and Financing Info.
Self Storage (Mini-Storage, Climate Controlled / Refrigerated Storage, Yard Storage, Other Storage)

Mixed-Use Commercial property Loan Rates and Financing Info.
Mixed-Use: A combination of usually two of the following: Office, Retail, Hotel, Multifamily, Industrial

Including:
Community Development & Financing
Agricultural Use Property
Rural Area Lending
Land Financing

  
for other available financing options - Please see:

• Hard Money
  
  
• Please Visit Bridge Loans for for the development of new commercial properties, or the renovation and repositioning of existing properties, for both pre-leased and speculative development.
  
  

  For Commercial Mortgage industry...
  see our page on CMBS (Commercial Mortgage Backed Securities)
  2nd mortgages not allowed...we show a way around this
  
  
  see Mezzanine Loans ...for Commercial Mortgage Loan Financing
  How to get a Junior Lien (similar to second mortgage)
  
  

• 1 - 4 Unit Financing (Typical Bank Loan Products for Investors), and 2nd home financing.
   
• Fix-N-Flip for 1-19 unit investment financing
   
• Investment_Specials

  
  
Also see Balloon Mortgage for Variable Rate & Cap Rate.
 
  
  
Please see the Commercial Only Glossary
(see Commercial Glossary)