Hello real estate developers,

Have you ever gone to the bank and got turned down, well here is a possible solution for that.
Let me know your thoughts.
Thanks,


Let's say a lender offers a 75% LTV loan on a commercial real estate deal but the buyer needs 90% to 100% financing. We will introduce additional collateral/assets to provide the additional 15% to 25%. Or say the borrower’s financials are weak, we will introduce additional collateral , CD, Letter of Credit to enhance the borrowers financial strength to help qualify to sign on behalf of the company.

This strategy may be used to provide funds through debt or equity. Since most lenders frown on secondary financing, we introduce our financial instruments as equity to provide the funds with an "equity" offering, which eliminates secondary financing. The additional down payment comes in the form of equity and not debt.

Is this a situation where the collateral is leased or is it a JV equity investment?

Are you proposing that the lender provide a higher loan amount based on the combined value of the subject property and the added equity?

Are the collateral/equity providers signing on and guaranteeing the loan right along side the developer?

What does this mean?

"to help qualify to sign on behalf of the company. "