Posted by James Strange on September 26, 2003 at 11:14:12:
If your broker does not even know how it works how can he know the rate and stips?
Why not do research on what bonds are yeilding.
Bond financing for Multi-family - Posted by DJ-n-NC
Posted by DJ-n-NC on September 26, 2003 at 06:37:56:
Has anyone ever heard of bond financing for multi-family properties in excess of $3mil? I was talking to my broker last night about financing options on a $10mil apt. bldg. and he told me he had access to some kind of financing using bank bonds or something of the sort. He was not sure of the details or how it works he said he’d look and find out I was just wondering if anyone else had ever heard of this. The thing that caught my ear was Int. Rate 2%, No appraisal needed, 25yr amort. 10yr call.
Re: Bond financing for Multi-family - Posted by Mark Dunn
Posted by Mark Dunn on September 30, 2003 at 17:31:35:
I work in muni-bond finance as a corporate trustee. The majority of my deals are under $5MM, but to qualify for tax exemption or tax credits (usually required to make the deals cash flow) the borrower must commit a certain percentage of the units to income restrictions. Testing is required annually to ensure compliance - the IRS is waiting in the wings for those who don’t. Rates can go as low as 1+%, but must be variable. Financials, surveys, appraisals, environmental compliance agreements are all part of the required doc load.
Re: Bond financing for Multi-family - Posted by Les
Posted by Les on September 26, 2003 at 12:19:06:
DJ,
I have heard of municipalities issuing bonds to raise money to lend for low-income MF housing. You would need to locate a local government that had such a program.
I doubt that bonds would be issued on just one property and borrower. The borrower would need an S&P or Moody’s rating-normally for large corporations-and, I believe, even $10 million would be too small for a bond issuance.
Depending upon the property and borrower, your best bet may be one of the gov’t insured programs which allow an LTV up to 90% and favorable rates.