After nearly thirty years in the commercial financing world, our managing director has streamlined a process that has proven to work time and time again. It may seem obvious but really matters as you only get one shot at a a good first look at a lending institution. Our clients' deals must look right before a lender ever sees it. Most mortgage brokerage firms will take your deal and "shotgun" it to many different lenders, hoping that it hits something and the deal works out in the end. When hunting, we prefer to use a rifle with a scope.
We start by understanding our lenders. Most lenders seem like a black box that borrowers feed information into but never receive anything other than an approved or denied decision. Due to our professional relationships and deductive lending observations, we know most lenders better than they know themselves. Every lender type and lender themselves have their own quirks and criteria. What a local credit union program looks like is completely different than what Fannie Mae's program looks like. Even within national banks, what Bank of the West likes Chase Bank will probably hate. All lenders are not equal nor do they want the same kind of deals. The is due to lender's underwriting guidelines. The average borrower will not know these guidelines or programs for a single bank much less all the lending institution types. All we do are loans.
Next we understand our client. Every client is different with different challenges. It is not as simple as saying someone has a lot of money. Liquidity and net worth are factors. Other factors matter just as much. From clients that are willing to personally guarantee a loan to entity managers with less than twenty percent ownership to those without ownership/operating experience, every situation is different and presents its' own challenge. Part of our service is going through entity structures and financial statements and advising how to present our client in the best light possible to the lender the first time. Also, every client's strategy is different.
Next we seek to understand the property in it's entirety. Just like our clients each property presents it's own challenge. An example may be an environmental issue but more specifically it's usually a value issue. Negotiating with a seller can be difficult but what about proving an appraiser his value is wrong? It does happen and without the correct information this task can kill a deal. We go through operating statements line-by-line accounting for capital expenditures. We pull tax records directly from the county. We get a new quote for insurance. We verify the information received so that when an issue does arise, it is taken care of immediately instead of, "uhhh, I don't know." We use our own sizing models for the property with market vacancy rates, loan values, and cap rates all plugged in to determine a value and how lenders will look at a specific deal. We look for red flags to address so that the lender sees our client's deal as easy and are more willing to stretch if there is an unforeseen issue.
Then we advise our clients what the best option is for them. Just because an advertisement says 3.49%, it doesn't mean anything. What is the rest of the program? For example, would a 3.75% rate with no prepayment work better than that advertised 3.49% with a yeild maintenance prepayment penalty for your strategy? This is another way we really ad value to your deal. By going over all your options, you make the most informed and educated decision possible. It's a decision that won't have a costly surprise down the road because you have a strategy that works and you understand it.
Get in touch with us and let us prove to you the difference Multifamily Capital Advisors will make in your deal. Remember that we are motivated to get your deal done quickly and efficiently. We don't get paid unless your deal closes. We do it right the first time, because like you we don't have the time to do things over and over.