Commercial Banker Discusses Typical Loan Scenarios for Private Money Deals.

Commercial real estate, private money loans also know as hard money and or bridge loans are becoming more prevalent as borrowers enjoy less red tape, quicker closings and more common sense underwriting than conventional financing provides. Typically though, borrowers still relay on this type of financing as an option when conventional sources are not available.

The increased speed and flexible underwriting comes at a steep price with interest only rates often in the teens, 3- 6 points being the norm and loan terms being relatively short at 12 36 months.

Why would owners pay such high fees/rates? In short, because it makes sense for them based on their current situation. Below are examples of transactions where it made sense for our borrowers or go the hard money route.

Grand Rapids. Small office building that was previously used as the owners business headquarters. The owner wanted to move his business out and convert the property into a multi-tenant building (investment property). To accomplish this he needed to create common areas, alter the entrance and add an elevator to the property. He needed a substantial amount of cash to make these improvements happen.

The problem was four fold: Personal credit was in the 400s, the owner had virtually no liquidity, the owner had no development experience and the year to date, profit & loss and balance sheet showed that his business was losing money. These issues eliminated any type of conventional financing.

The owner knew that the property would be a cash cow, and drastically improve his overall financial position, if he could get the money needed to complete the project. For the lender the deal made sense as well, due primarily to the low loan to value (High equity).

In addition, the exit strategy was simple, after the building was renovated and leased out, the property would stand on its own and qualify for conventional finance base off the new cash flow.

Metro Detroit. Local business that owned six retail buildings and had its loan called (forced balloon) prematurely by its bank. The loan was called primarily because the business had lost money for three years in a row. The bank was nervous the borrower would go out of business. The business was forced to seek alternative financing.

Besides the above, multiple conflicting partners further complicated the matter and made conventional financing that much more difficult to obtain.

However, the properties where in solid condition and had much equity. The borrowers where able to leverage the equity and refinance their existing mortgage and roll in other business debt into the private money loan.

The result was increased cash flow enabling the business to regain profitability even though their rate was much higher than the previous mortgage.

Cleveland. A real estate investor was in the process of purchasing a 40,000 square foot mixed use building. The seller became frustrated and began to doubt the buyers ability to purchase the building as the conventional lender became cautious and dragged the process out. To the buyers shock, the lender pulled out, two weeks before the scheduled close.

The primary issue for the conventional lender was that although the current net operating income could support the proposed loan, the historical (average of the last 3 years) net operating income could not meet the traditional banks Debt Coverage Ratios.

The buyer, fearing that he would lose the property and money he had already put into the deal, used private money to meet the closing schedule. The exit strategy to pay off the private money loan was to simply continue to document the current net operating income and refinance the debt into a conventional loan one year out.

These are typically private money scenarios, others include foreclosures, distressed properties, recent bankruptcies, lack of existing cash flow, partnership buy outs, land contract refinances, need for speed,etc.

Common positive traits that make the loans financeable include loan to values less than 60% and clear exit strategies on how the borrower is going to pay back the private money lender.

Yes, hard money is expensive, but can be a viable option given the right (Or wrong) set of circumstances.

Jeff Rauth is President of Commercial Finance Advisors, Inc. based out of Bloomfield Hills, MI. He specializes in Commercial Real Estate Loans between $100,000 - $5,000,000. Offers unique loan programs such as Commercial 30 Year Fixed, private money loans and 90% non SBA financing. He can be reached at 248 990-7602. jrauth@cfa-commercial.com www.cfa-commercial.com.Lake Cumberland Real Estate
Long Foster Real Estate
Sullivan County Ny Real Estate
Pennsylvania Real Estate School
Nort Hdakota Real Estate
Brazilian Real Estate
Las Vegas Real Estate Summerlin
Mckinney Texas Real Estate Agent
Homestead Real Estate
Ocala Fl Real Estate For Sale
Marketing Real Estate
Real Estate Office Supplies
Nh Real Estatel Icensing
Real Estate Listing In Los Angeles
Irish Real Estate Agents

Super Self Confidence - How To Lose It And How You Can Get It Back

It is well worth discussing what self-confidence is, before describing how you can change your low self confidence into healthier and empowering confidence.

As human beings, we action many tasks automatically and without having to think too much about it. An example would be riding a bike. Even though we might have gone through a few years of not using a bike, if we needed to, we would not find any difficulty in getting back on a bicycle and riding again. This is because we have done it so many times before that we know just what to do and do not have to give it too much conscious thought. So if you were to ask someone, how confident are you that you can ride a bike, as long as they had learnt to ride a bike in the past, they would probably say 'very confident'. They feel confident about it because they have done it many many times successfully before. In fact they now give very little thought to actions required to ride a bike. It all happens automatically.

This can be called a type of self confidence. Knowing something so well, that as the saying goes, you could do it with your eyes closed or you know it like the back of your hand.

Now when someone says that they have low confidence, they can so easily make the mistake of encompassing their whole life with this label. They might even say 'I never have any confidence in myself'. By saying this out loud to others who will listen, or even thinking it to themselves, they will be setting up a self-fulfilling prophecy. The label you give yourself or the label you accept as being true will invariably mean that you start to fit yourself to that label, and, can make it your own living reality.

However, that person above will be able to successfully accomplish many things confidently but, and here is the big 'but' they will not use these successes as evidence of confidence. They will dismiss or belittle them in some way (e.g. saying "I was lucky") so that they can maintain this need to say they have no confidence. This is a pity as it is only through taking a realistic view of what happens in their world, will they then be able to feel more confident about themselves.

It can be quite startling how someone will say they have no confidence and yet 5 minutes later they will tell you about some amazing things that they do such as talking in front of 10,000 people, or they go mountain climbing. Despite undertaking these events, which ordinarily seem nerve-wracking events, they may still say that they have low confidence.

So confidence or the lack of it, has a lot to do with how you view yourself. If this is the case then really it is down to a perception. Perceptions are not a true reflection of reality all of the time. Often perceptions, even between just 2 people, can be remarkably different even though these 2 people have in reality, experienced exactly the same thing.

Perceptions are the filters we use to process what happens around us. Our perceptions can make us feel good, bad or indifferent. They can give us a boost of energy or deflate us into an anxious and fearful mass. Our perceptions have power.

Our perceptions are, more often than not, based on our past conscious and subconscious experiences. They are our way of analysing what happens around and enabling us to decide the implications for us. When experiencing anything, our minds will very quickly compare the current experience to past experiences and, these past experiences will indicate how we should react to this current experience. If we have had a bad experience that seems very similar to the current experience, we will feel in a similar way to the feeling we associated with that past bad experience.

So our perceptions are based on past experiences and what we have learned from them.

This gives us a clue about how we can change and become more confident. Our perceptions can be so inaccurate and if they were formed at a young age may also have lacked understanding. Most of us have had the experience of perceiving someone or some situation in a particular way, only to realise that we got it completely wrong. With this in mind, although our perceptions are a form or protection and are meant to enable us to weigh up a situation quickly, they can also be wholly inaccurate.

Healthy and robust self-confidence begins by accepting that your perception of yourself may be wrong in certain matters. For example, some friends will be astounded when someone announces (may be on a drunken evening), that they have low confidence. These friends will say will all sincerity that they find this hard to believe as they always appear confident and in control. Yet that person will still insist that they lack confidence. Obviously the signals that they are externalising are not the same as those that they are internalising. Often the person who appears to be the most confident and out-going will have terrible doubts and internal conflicts. The external bravado will be their way of masking how they feel inside.

Balanced self-confidence begins by admitting and accepting more evidence of what you can do well. It also begins by accepting positive and complimentary comments made to you as well as other forms of evidence. In the past you may have dismissed a positive comment that was said to you because you didn't know how to handle it. You may even have made a joke of it or tried to dig up the tiniest fragment of evidence as to why you don't deserve such praise. Many people say something like this 'Oh, it was nothing'.

It would be virtually impossible to retain your self-confidence if you are someone who always dismisses or belittles their achievements. So make up your mind from today not to do it. Decide from this moment onwards to say just two words when someone says something nice or complimentary to. The two words are 'thank you'. Try it out next time and see how you feel about it. It will help you start to feel the confidence that has always been theyre waiting for you.

Steven HaroldHypnotherapy Valerie Austin
Sacramento Hypnotherapy
Free Quit Smoking Hypnosis Mp
Diet By Hypnotherapy
Free Online Courses In Hypnotherapy
Hypnotherapy Session
Lose Weight With Cd Tape Self Hypnosis
Quit Smoking Hypnotherapy
Hypnosis Software Download
Hypnotherapy Message Board
Dateline Hypnosis Loss Weight
Hypnosis Scripts For Anxiety Panic Attacks
Online Degree Hypnotherapy
Hypnotherapy Ny
Ar Hypnotherapy Strange