Commercial Loan Refi

[Damien Davis]

Hello BP Family,

Looking for some advice/guidance. I recently created a LLC approx. 1 year ago and refinanced my duplex from a FHA to DSCR loan. The commercial lender that I been dealing with hasn't been the best with communication and distributing documents when needed. Basically, I want to deal with someone else but I might be stuck. My rate is 7.875%, 30yr note, 71%LTV with a 5yr prepayment penalty. Any and all advice as to what options I may have would be greatly appreciated.

[Matthew Bernal]

The frustration with your current lender is valid, communication and document handling are basic expectations that should be met regardless of your rate or terms.

The 5-year prepayment penalty is the real constraint here. Most DSCR prepayment penalties are step-down structures so at year 1 you're likely looking at a 4-5% penalty on your loan balance. That math usually doesn't favor refinancing right now unless your balance is very small.

The practical move is to document everything with your current lender in writing, stay organized through the penalty period, and plan the refi for year 3 or 4 when the penalty drops enough to make the numbers work.

Happy to connect now so when that window opens you have a lender ready to move fast with better service.

Do you know the approximate remaining balance on the loan?