Lender · United States · Member since 2020 · 1k+ posts · 499 votes
I've been involved in the 1-4 unit side of things for the past few years and I'm curious to know what people typically pay on the rate for bigger projects. I'm talking loans of $3 million+. Things like 50-unit apartment buildings.
Lender · Southwest Georgia · Member since 2017 · 312 posts · 278 votes
5y
@Timothy Hero This all depends on the deal, but standard rate is anywhere from 4-5% fixed for 5 years with a 20 yr amortization schedule. Your loan fee will range from 25 basis points to 50 basis points but should never be a full 1%.
Investor · New York, NY · Member since 2008 · 187 posts · 36 votes
5y
Hero that would still be determined by the loan product, market, DSCR, LTV, credit. The reasonable response is what are your expectations regarding LTV, DSCR, liquidity etc? Your mention of terms is absolutely critical.There are 3-4.25%, 4-6.5%, 6.5-8.75% programs with lower rates for shorter 5-10yr terms full doc and upper rates for limited docs and longer terms. Everyone is smelling the roses when they hear the rates. Reality hits when the file gets to underwriting.
Lender · Southwest Georgia · Member since 2017 · 312 posts · 278 votes
5y
@Timothy Hero This all depends on the deal, but standard rate is anywhere from 4-5% fixed for 5 years with a 20 yr amortization schedule. Your loan fee will range from 25 basis points to 50 basis points but should never be a full 1%.
Thanks Mitchell! It sounds like rates aren't too different than non-qm residential. It sounds like the closing costs are less on a percentage basis.
I'm not in the non-qm space but I haven't seen any over $2MM. It's troubling that it is being compared to products that are designed for $3MM+ and 50+ unit transactions. I think you're cross analyzing the wrong data. That's why the only proper response to a rate question is, what are your expectations provided blah blah blah blah blah?
Rental Property Investor · Boca Raton, FL · Member since 2019 · 70 posts · 42 votes
5y
Agency debt is typically 75% LTV and can be in the 3-4% range it today's nearly free money environment. Bridge debt is more expensive but you can borrow up to about 80% LTC (Loan to Cost) which means you can borrow your capital expenditures used to rehab the property. With agency debt, you must raise the equity to do the renovations which dilutes the returns.