All Forum Posts by: Andrew Beauchemin

@Jeffrey Kovnick 1% is pretty standard fee for Commercial mortgage brokers.  As mentioned above, you should make sure that your agreement is non-exclusive and do some shopping around of your own, outside of CBRE's lenders.  

Don't be afraid to negotiate that 1%.  I have done deals as  Commercial mortgage broker for as low as 1/2 a point.  I would offer them 70-75bps and see if they gawk.  In addition, I think the broker should always attempt to negotiate the lender's origination fee down to accommodate for their fee.

@Dalwin Garcia The best way, in my opinion, to find commercial deals is through commercial brokers.  The trick is getting access to their 'buyer's list', getting access to listings before they list them publicly.  

Loopnet is a great place to start, you can search for properties that may be similar to something you're looking for, then find out who the broker is that's listing that property.  Give them a call and start a conversation, and I'm sure they'd be willing to show you some of their pocket listings if they feel you're a serious buyer.

@Kenneth Ryan If you can qualify, Agency debt can bring some of the best terms available on multifamily deals. You will need to meet their requirements such as net worth, liquidity, must be in a good market, etc. to really get the best rates. Check out the Fannie & Freddie website for more info on their reqs and rates. Paperwork / processing can be longer & more of a headache than from a bank. I'd rank them slightly higher than HUD or going to the DMV.

TapCap appears to be a broker, I have never heard of them, but there are a slew of new digital groups out there recently. Do your research, ask for references, look at their transaction history, ask them about their fee structure, etc. Make sure they are actually providing value and guiding you through the transaction, not just building a database and making you do all of the work.

There are only a couple dozen of actual Agency debt servicers. Check the Fannie & Freddie websites for "DUS Lenders", they will list them. (I don't think BP will let me post a link). If they aren't on the list, they're most likely a broker. These servicers will represent the Agency lender, and will service your loan through the life of the term. 

@Kenneth Ryan If you can qualify, Agency debt can bring some of the best terms available on multifamily deals. You will need to meet their requirements such as net worth, liquidity, must be in a good market, etc. to really get the best rates. Check out the Fannie & Freddie website for more info on their reqs and rates. Paperwork / processing can be longer & more of a headache than from a bank. I'd rank them slightly higher than HUD or going to the DMV.

TapCap appears to be a broker, I have never heard of them, but there are a slew of new digital groups out there recently.  Do your research, ask for references, look at their transaction history, ask them about their fee structure, etc.  Make sure they are actually providing value and guiding you through the transaction, not just building a database and making you do all of the work. 

There are only a couple dozen of actual Agency debt servicers.  Check the Fannie & Freddie websites for "DUS Lenders", they will list them. (I don't think BP will let me post a link).  If they aren't on the list, they're most likely a broker.  These servicers will represent the Agency lender, and will service your loan through the life of the term. 

@Mit P.  1. Non-refundable fee does not make sense - agreed.  Unless the broker is doing some sort of 'advisory / consulting' in the form of building proformas, deal analysis, etc. then I would only pay the 1 point after closing.

2. 24 months is long - This is negotiable.  I've done terms that conclude at the closing of the transaction, and I've done 36 month terms.  He is looking to be protected in the event you use his lending source for future deals.  You could work out a step-down agreement in addition to the term length; i.e. 1st deal with this lender, fee is 1%, 2nd deal is 0.75%, 3rd deal 0.50% fee

3. What is advantage of shopping one lender at a time? - This is your (the borrower's) decision.  The broker should already know who the best, or at least top 3, lending sources will be for your deal.  Some borrowers prefer not to be "shopped" around, whereas some borrowers like to get a dozen quotes.  

4. What approx average commissions are expected for 700k loan amounts? - 1% is market-rate standard for debt placement in my opinion

5. What approx interest rates should I expect? - This will be tough to determine without knowing more about your property.  It will be Spread-based over an index; i.e. Treasury, Libor, WSJ Prime etc.

@Jonathan Ortiz There are so many unknown variables here.  You'll have to give us more information on your goals, your investor's goals (if there are any investors), the type of property, the market, your exit strategy, etc. etc.

There is no blanket "best" financing option.  Every deal is different, every borrower is different, and every financing option will be tweaked specifically to match.

@David Scheuring What type of commercial assets are you looking at?  I can point you in the right direction in the Philadelphia Market

@Jeffrey Fawaz I agree with @Scott Morongell that brokers will be your best source of off-deals.  You should come prepared with a specific list of parameters that you look for (unit mix, cap rate, rent per unit, etc.) and follow up with them every few weeks.

A good way to find brokers is to start with the big companies (CBRE, Marcus, etc.) and download OM's from their website on similar properties to what you're looking for.  

Agency is tough in tertiary markets... sometimes sub-70% LTV. Start with a local / regional bank

1.20-1.30 DSCR I think is normal for banks.

@Rich Somers I've had clients pull out cash from a HELOC, and as long as the cash was sitting in their account prior to the loan application, all went well. I can't imagine any lender asking you to provide an audit for your cash reserves.

If you show them your account today, and your balance=X, then a week later you have an additional $100,000 in there, then they may ask questions.

Depending on your relationship with the lender, maybe ask for his opinion "off the record?"