Posted by cam on July 01, 2003 at 21:19:34:
Hanover Financial does not provide 100% LTV financing. They instead place debt at 75-85% and provide cash in exchange for equity participation. Equity participation is not true 100% financing but rather has a JV structure. True 100% financing would be in the form of a mortgage note or notes and where the project stays solely in the borrowers name. Debt/equity deals have a mortgage note for a portion of the funds but also require that the equity participant have ownership rights until certain returns are realized to the equity partner. Once these benchmarks are acchieved and returns paid, the equity partner releases the property via the pre-arranged exit strategy.
100%ltv??? - Posted by sabatini
Posted by sabatini on July 01, 2003 at 16:03:06:
I’ve heard rumors of lenders funding 100% ltv on large multi-units(4 to 10 mil) that show great cap rates.
I’m in Las Vegas and there are some very strong properties in this area and I am looking to find a way to get into the market here.
I have good fico, some assets, but not much cash.
Re: 100%ltv??? - Posted by cam
Posted by cam on July 01, 2003 at 16:14:29:
Unlikely. 100% LTV has generally been the offering that scammers use to part borrowers with upfront fees only to deny funding or disappear completely.
From a lenders standpoint it makes no sense to offer 100%. If they wanted to do that, they could just buy the building themselves, pay a 5% management fee for someone else to run it, and get a far better return than the interest rate they would charge you.
Tread very carefully when someone offers 100% financing. I have never seen legitimate 100% LTV for commercial properties (with the exception of medical properties, occupied 50% or greater by borrower)
Re: 100%ltv??? - Posted by Kent
Posted by Kent on July 01, 2003 at 20:51:32:
If the projects are large enough and of “instutional quality” there are companies that can place up to 100% debt. One such company is Hanover Financial. There are plenty of others but both the property and the return have to be very attractive.