Beautiful house

$1,250,000

Transaction Description

Loan for a multi-family property in Berkeley, CA. 

LoanBase successfully arranged a $1,250,000 2- year bridge loan for a 6-unit multi small 6units multi-family building in Berkeley, CA. The Borrower was seeking for a solution with transparency, the efficiency of the product, and reduced transaction costs. The Borrower who is a real-estate investor requested long term, non-recourse financing.

Although the sponsor wanted a low fixed rate, he was seeking a banking relationship in
order to refinance various other projects in his portfolio as well. The complex is situated near the UC Berkeley Campus and closes to the BART station and a 15-min walk from Berkeley downtown. The asset was built in 1962 and consists of 4
units. The developer added another 2-unit building at the back of the lot and needed a bridge loan to allow plans submission, permitting, and construction period. At the end of the process, the lot contained 4 units two-story building and another 2 units two-story building, increasing the value of the property by over 78%.

Strategy:

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After completing the quick survey detailing his asset, LoanBase was able to connect
the Borrower with 12 qualified lenders, after searching over 210 bridge lenders in its database each providing live quotes that matched the Borrowers criteria. The Borrower was then able to converse and strategize with lenders of their liking in order to achieve quotes that fit his/her needs. The borrower got a tailored quote based on their specific needs with a lender that specializes in that area.

There are many challenges with construction projects and that’s why having the right lender to back you up is a crucial key to success. LoanBase mission is to find a lender that understands the client’s needs while saving 90% of time spent on search and research. a simple search in LoanBase engine brought up dozens of qualified lenders with a specific offering that fitted the client’s needs- and fits just like a glove. The Borrower was seeking a lender that would be comfortable proving a max leverage loan (75%-80%) at a rate that is less than 8%/yr with proven ability to close within 30 days.
The end result was better than the initial expectation as LoanBase was able to secure a lender that granted an 80% LTC loan with a lender 6.95% rate.

 

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Transaction Details

Loan Amount: $1,250,000

Rate: 6.95%

Term: 2 Years

LTV: 80%

DCR: 1.25x

Prepayment:  no pre-pay

Recourse: Non-Recourse

Lender Origination Fee: None

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Successful Results:

Despite the hurdles, Loanbase was able to source a lender who understood the asset, market despite the COVID-19 vacancy challenges, and believed in the Sponsors business plan. LoanBase was able to assist the Borrower through every step of the way in order to achieve their goals. The Borrower was
able to attain non-recourse, long term 10-year financing, fixed rate of 3.44%, 70% LTV, with a 30-year amortization. The transaction was closed within 45 days of the loan application and left both lender and borrower with a desirable result and a long-lasting partnership on future investments.

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