Multifamily (MFR) Financing: Falkirk Capital

9 Replies

I’m looking to refinance a 26 unit apartment property using Fannie Mae/Freddie Mac and I’m getting assistance from Falkirk Capital. Has anyone else on BP used their services to do something similar? If so, how was your experience?

Thanks, Bruce

It looks as though they are a broker versus a direct lender, but there's nothing particularly wrong with that. The Fannie and Freddie programs and leverage are the same regardless of provider, so if they're offering good customer service it's probably worth working with them. I imagine they will place the loan with a group like Sabal, Arbor, Hunt, Pillar, etc. All of them are very experienced lenders/servicers.

Thanks @Kyle Jean , that's the thing, I don't know what "good customer service" is with nothing to compare it to. Do you have experience with the SBL program? If so, what is a typical closing cost? I have several quotes from different brokers and they range more than I'd like to see, so makes me hesitant. Thanks again

Bruce

Bruce,

I work for CBRE, we did the most small balance Freddie Mac loans in 2017 out of any lender and can help you with any questions you may have. Even though the broker will eventually go to CB, Arbor, etc., it is really up to the direct lender on how the process goes as they are the ones that will do the actual underwriting and who you will be in contact with most. Also, while I agree there are positives of using a broker, your rate/closing costs will always be higher since there is a middle man so it never hurts to get a quote from a direct lender. Typical closing costs, at least for us are about $6k for the 3rd parties and around $4k for legal. 

Also, it depends on the location of the property, but we are quoting SBL properties around a 4.7% interest rate. If your rate is above 5%, you are really getting taken advantage of. 

@John Brady . Thanks for the info, I've definitely heard of CBRE. I will keep that in mind going forward. So you're saying that all in closing fees are about $10k? Is that defendant on property price? For a property of $1.3M, does that seem right? 

Correct. All of the ones we do are in the $10-$12k range. I can't speak for other lenders, but we use our own appraisers to appraise the properties and this cuts down some of the cost you might see from other firms that don't have their own in house appraisers. For small balance loans, we charge the same price every time regardless of the property price/loan amount. Note though, these are just our fees, you will most likely need to get your own legal counsel which isn't reflected in our fees or any title fees, etc and is taken care of by you on the side. I only work in the $1M-7.5M space, so anything above that I can't really speak much about, but for a $1.3M loan, these are the numbers we give borrowers. We can also waive the appraisal fee in some cases.  

Also, there would be a 1% origination fee since this is how we make money, but it is a much better deal than the broker charging a 1% fee plus the direct lender charging another 1%. That's why I would suggest always getting a quote from a direct lender as it will always save you money. 

Good Evening @Bruce Scannell , I have not worked with them. I was looking into using them for future ventures and wanted to get some insight on your (and everyone else's) experience with Falkirk, if any. Hopefully the issue at your property clears up.