Beautiful house

$1,250,000 Multi-Family Home

Transaction Description

Multi-family property in Berkeley, CA. 

LoanBase successfully arranged a $1,250,000 2-year bridge loan for a 6 unit multi- family building in Berkeley, CA. The Borrower was seeking an efficient, transparent solution with reduced transaction costs. The Borrower, a veteran 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 minute walk from downtown Berkeley. 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 four, two-story units and two, two-story units, which increased 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 their needs. The borrower received 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 is key to success. LoanBase’s mission is to find a lender that understands each client’s needs while saving time spent filling-out multiple applications with multiple lenders. In this specific case, 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% per year with the ability to close the loan within 30 days.
In the end, LoanBase was able to secure a lender that granted an 80% LTC loan with a rate of 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, the market, and believed in the Borrower’s business plan. LoanBase was able to assist the Borrower through every step of the process in order to achieve their goals. The Borrower was able to attain a non-recourse, long term 10-year financing, fixed rate loan at 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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