COMMERCIAL LENDING NEWSLETTER
You are receiving this letter because you are one of my Spartans - my top-producing brokers and investor clients - of whom I am allowed to have 300. Removal instructions are below. Today we'll talk about how the availability of cheap commercial financing affects value. And, of course, we have lots of cute, clean jokes, some funny pics, and a video of hilarious pranks.
Joke Du Jour
As I drove into a parking lot, I noticed that a pickup truck with a dog sitting behind the wheel was rolling toward a female pedestrian. She seemed oblivious, so I hit my horn to get her attention. She looked up just in time to jump out of the way of the truck's path, and the vehicle bumped harmlessly into the curb and stopped. I rushed to the woman's side to see if she was all right. "I'm fine," she assured me, "but if that dog hadn't honked..."
Sometimes You Have To Make a Leap of Faith
Private Money Commercial Loans Nationwide From $100,000 to $3.5MM
Is your client's commercial property partially vacant? Do you need a lender who will allow the seller to carry back a second mortgage? Does your client have a balloon payment coming due on his commercial property? Has your bank offered him a discounted pay-off? Does your borrower have less-than-stellar credit? Is your client's company losing money? Is your borrower a foreign national? Do you need a non-recourse loan? We make slightly scratched-and-dented commercial loans.
Our hot, new product is a blanket loan against a portfolio of rental homes. Rental homes? Yup, as long as there are at least five homes or units, we consider this to be a commercial loan. We even offer a partial release clause. This loan is ideal for speculators.
And don't forget, we will quickly and happily issue you a written Loan Approval Letter - at no charge - that you can use as a fallback and to lure cheaper lenders. After all, everyone wants to lend to you if you already have a commitment. Here is our latest rate sheet.
Blackburne & Sons is looking for commercial real estate loans that are not quite clean enough for a bank. Please click here to submit a hard money commercial loan or call me, Tom Blackburne, at (574) 210-6686.
"In an episode of 'The Price is Right' this week, a contestant in a wheelchair was awarded a treadmill. Well, to be fair, the show isn't called 'The PRIZE is Right.'" -- Seth Meyers
Not Every Commercial Property Qualifies For Cheap Bank Financing
Suppose you have a choice of buying two different properties, both leased to solid tenants on a long-term basis. Both properties generate the exact same amount of net operating income - $60,000 per year. Property A, however, is a type of commercial property that is favored by most banks and can be financed up to 75% LTV at a fixed rate of just 4.375% interest. Property B is an out-of-favor property type that can only be financed at an adjustable rate of 9.0% up to just 55% LTV.
Whether or not a property qualifies for the cheap bank financing makes a huge difference in its value - even though two properties might generate the exact same amount of net operating income. Because a buyer can use cheap leverage, Property A (apartment building, office building, strip center, or multi-use industrial building) may sell for a whopping $1 million (6.0% cap rate).
On the other hand, the buyer of Property B (restaurant, unflagged hotel, gas station) may have to put down 45% of the purchase price and be satisfied with a much higher interest rate. Property B may only sell for $600,000 (10.0% cap rate). Need a refresher lesson on cap rates?
Need a commercial loan? Simply complete this super-easy mini-app.
Couldn't Help But "Crack" A Smile...
The woman said to her beautician as she sat down for her appointment, "When you're finished with me, will my husband think I'm beautiful?" "Maybe," replied beautician, "Does he drink a lot?"
Sweet Apartment Loan Program for "A" Deals
Blackburne & Sons has a terrific apartment loan program for "A" quality deals. Our fixed rate is adjusted according to the desirability of the property and the area, but it starts at 3.87% and 1 point for a 30-year fully-amortized loan. For more details, please call Tom Blackburne at (574) 210-6686.
Mother's Day Joke
"Happy Mother's Day to all the moms out there. I saw a lot of people were posting old photos of themselves as a kid with their moms. Because what better gift to give your mother than a photo of how she used to look before you completely wore her down." -- Jimmy Fallon
Small Balance Preferred Equity ($100K to $1MM)
If an investor wants to buy a leased commercial property, banks today will seldom lend more 58% to 62% LTV. Your buyer only wants to put down 25% of the purchase price
Quick, easy preferred equity from Blackburne & Sons fills in the missing piece of the capital stack. We'll add our $150,000 in equity dollars to your client's $250,000 down payment to create a down payment large enough to satisfy the bank. Think of our preferred equity as tiny Joint Venture investments.
For more information, please call Tom Blackburne at (574) 210-6686.
Obviously a Community Property State
My girlfriend isn't the brightest bulb. One day when she was being particularly dimwitted, I said in frustration, "What's your IQ anyway?!" She shot back defiantly, "20/20!”
Too Busy to Broker Commercial Loans to Us? Why Not Just Refer Them Instead? We Make It Easy!
We once paid a $21,250 referral fee. Here is our referral fee program.
Hilarious Video of Pranks
Some of these clever pranks are based on scary movies, and I too would have run like a terrified sissy!
On a Personal Note
I recently started renting a house in Indianapolis from a friend of mine. Between boarding school, college dorms and apartments, I never really lived in a house since becoming an adult. The property had been vacant for almost 2 years and was in desperate need of some TLC. I have practically zero experience working with tools (changing a light bulb is about as handy as I got) and the fact that there was no property management company that I could call only added to my stress. But, the rent was very low and I saw it as an opportunity to learn basic home maintenance, while saving up for my own home. Upon moving in, I quickly realized the property did not need TLC, but rather an extreme makeover! The entire front lawn plumbing had to be ripped out and replaced, the garage door had to be completely replaced, the windows replaced, the HVAC unit replaced, the dishwasher had to be fixed, the refrigerator had to be fixed; I can go on and on. This move has been a huge headache. But that being said, the experience was essentially a crash course in home repair that I desperately needed. I now know infinitely more about home ownership/maintenance than before and it will be immensely helpful when I purchase one of my own.
Don't Forget About C-Loans.com
We have a whole new crop of hungry commercial lenders on C-Loans, so if you have a commercial loan you're trying to place, it takes just four minutes to submit your deal to 750 commercial lenders. And remember, C-Loans.com is free!
One night at about 3:00 am my wife was getting up from the toilet to return to bed when she heard a little noise. It was a suspiciously rodent-like sound that seemed to be right in the bathroom with her. She, of course, froze and listened attentively for any further sign of invaders. After a moment, satisfied that she was alone, she took a step for the door. Rodent scratchy sounds again! She froze, not breathing. Silence. Her heart raced as she once again tried to retreat from the bathroom. This time the noise was accompanied by something touching the back of her leg! That was too much to bear. She literally flew the 8 feet to the bed, clearing the foot board by a couple feet, to land screaming by my side. The culprit was right there in plain sight... a trail of toilet paper neatly marked the path from the bed to the bathroom.
Get a Free E-Book on CREF
This free e-book contains seven of George's best blog articles on the subject of commercial real estate finance.
BRE# - 01919403
NMLS# - 1014118
BLACKBURNE & SONS REALTY CAPITAL CORPORATION
4811 Chippendale Drive, Suite 101
Sacramento, CA 95841
Phone: (574) 210-6686
Fax: (916) 338-2328