All Forum Posts by: Ben Tiggelaar

Quote from @Jordan Moorhead:

@Ben Tiggelaar from what I've been hearing that seems fair. Rates have gone up a lot the last few months! Keep in mind this was a normal rate in 2018. I closed a primary at 4.875 in august 2018. This is still a great rate when you look at historical rates.

 Got it. Appreciate the experience share :-)

Quote from @Troy Ballew:

@Jay Hurst

Agreed, it isn’t a terrible offer. 4.875% with no points is about right for an investment property right now.

I locked at 4.00% for a 30 year term with Guaranteed Rate on a duplex about 4 weeks ago and paid for almost a point to keep the rate down. I’m planning on holding for a few years, at least.

We’ll probably see 5.5% to 6% late in 2022 for investment properties after the Fed gets going on their rate increase campaign this March.

Troy

 Thanks that’s helpful!

Quote from @Jay Hurst:

Quote from @Ben Tiggelaar:

I have a 4 plex in Austin, TX under contract that is fully rented. I have a term sheet from Guaranteed Rate for a 30 year fixed conventional mortgage at 4.875% with no points. Is this a fair rate and pricing right now? Are there any others that you know to be more competitive right now? 

 The "rate" on any conventional loan is based on a number of factors including obvious ones including the occupancy, loan to value, credit score, property type but even less obvious ones as loan size, rate lock period, if you are ok with an escrow account or not, total lender fees (yes, "points" are an obvious one but I seen fee sheets with 6 500 dollars charges with creative names that were not origination or discount points but added up in total costs as the same thing so who cares what it is called.  So, this might not be much help but it is hard to say if something is fair or good pricing without knowing all the details. 

Interest rate: 4.875%
30 year fixed

$9892 of closing costs (breakdown below)
Lender fees: $1440
app fee: $150
appraisal fee: $925
credit report fee: $29
attorney review (TX only): $150
Rent schedule: $150
appraisal rush fee: $200
undisclosed debt report: $69
Title fees: $775
owners title insurance: $1280
lenders title insurance: $4120
recording fees: $204
survey fee: $400

I have a 4 plex in Austin, TX under contract that is fully rented. I have a term sheet from Guaranteed Rate for a 30 year fixed conventional mortgage at 4.875% with no points. Is this a fair rate and pricing right now? Are there any others that you know to be more competitive right now? 

I'm analyzing a retail building that has a NNN tenant that represents 59% of rental revenue (7,500 out of 15,000 sq ft). This tenant has a 5 year lease with four 5 year options to extend the lease by another 5 years (they have already exercised the option 2 times so they are on year 12 of the 5 year lease). The lease option is ending in August 2024 (2.5 years from now). The tenant is a corporate and there is a dedicated real estate employee who runs their real estate operations. I'd like to reach out to the tenant's real estate employee and ask about their plans for the space going forward, if they need additional improvements to the space, and if they plan to exercise the option in 2024. Obviously, the broker would probably prefer me not to reach out, but is the #1 risk to the deal.

How would you go about finding out this information? What is appropriate? My guess is if I ask the broker and he will say "you can't contact the tenant, but they plan to exercise the option". The space is large enough, where if the tenant decides to leave in 2024, it would result in significant capex in order to adjust the space to fit other tenants + the rates would probably be lower.

Originally posted by @Cason Acor:

I would get in touch with a commercial mortgage broker. Virtually all of the major national commercial real estate brokerages will have people they can connect connect you with. 

I have spoken with some and I've only been provided full recourse leads, unfortunately.

I'm seeking to acquire a 9% cap rate office building with solid, long-term tenants in a great location. I'm putting together the financing now. Where is the best place to find a Commercial Mortgage Backed Security (CMBS) Loan or any non-recourse loan in the size of ~$2M to $2.5M? All the local banks I've spoken to require a PG of some sort (limited or full recourse). I'm looking for non-PG financing options, with the loan only securitized by the asset. Willing to pay a higher rate & lower total debt.

I found Arbor, but their minimum loan for their CMBS product is $5M. Do you have any recommendations on the type of product I should be looking for?