Apartment Loans and Apartment Financing

Apartment loans reside in a very competitive part of the commercial mortgage market. Apartment lenders want your apartment loan business and are willing to compete on apartment financing rates and terms to get it. RealWebFunds creates a competitive environment by shopping apartment loan requests to a wide variety of apartment lenders. Currently, we have over 100 apartment lenders in our database. You can use RealWebFunds apartment financing (brokerage and referral) services throughout the United States. You will realize the benefit of our unparalleled efficiency with both a great apartment loan and with our low fees.

Typical Apartment Loan Rates (for loans over $2,000,000) Loan to Value (%) 50 60 70 80 10 yr fixed 6.4 6.4 6.6 6.8 5 yr fixed 6.1 6.1 6.3 6.5 3 mo ARM 5.7 5.7 5.9 6.1 More rates... Types of Apartment Lenders We shop loan requests to all types of apartment lenders including: Fannie MAE, Freddie MAC, FHA/HUD Lenders Conduit Lenders Banks Life Insurance Companies

Types of Apartment Financing Permanent - We find fixed and variable rate loans with terms from 5 to 20 years for stabilized properties. We find the best rates by encouraging competition for your business among lenders. Bridge and Construction - We find short term financing when you are creating value in the property. Equity and Mezzanine - We find partners who provide equity when you have an opportunity to add significant value over a short period of time (projects over $4,000,000 only).

Typical Apartment Financing Terms

Note: These are not terms of any specific lender. They represent terms that we frequently see in the marketplace and are not to be relied on as a commitment to provide any specific terms for any specific deal.

Maximum loan to value:	Apartments are most frequently financed at 80% of value or cost (whichever is lower). For loans under $2M, there are a few lenders who will go to 85% or 90% or will allow secondary financing for a combined loan to value of 85% to 90%. For long term fixed rate loans a small "mezzanine" piece can be added to the loan to yield an 85% LTV.
Debt service coverage:	The cash flow from operations must be at least 1.20 times the mortgage payment.
Term:	5, 7, 10, 15, 20 year terms are most common.
Amortization:	25 or 30 years if building is in good repair
Typical Rates:	10 year fixed = 10 yr US Treasury bill rate + 1.0% to 1.5% 15 and 20 year fixed = 10 yr Treasury + 1.5% to 2.0%> 5 year fixed = 5 yr Treasury + 1.5% to 2.0% ARM = LIBOR + 1.5% to 2.0%
Occupancy requirements:	Most lenders require 90% occupancy for 90 days in order to qualify for a permanent loan.
Prepayment terms:	10, 15, 20 year fixed rate loans - typically have prepayment based on "yield maintenance" or "defeasance". This kind of prepay can make it prohibitive to refinance or sell the property (prepayment fees can easily exceed 10% to 15% of the loan). Some lenders offer a reduced prepay for an increase rate (e.g. for 0.5% increase in rate the prepay can be a decreasing amount each year (e.g. 10%, 9%, 8%.....3%, 2%, 1% for the first ten years). 5 yr fixed rate loans - typically have a decreasing prepayment each year (e.g. 5%, 4%, 3%, 2%, 1%). Adjustable rate loans - typically have a decreasing and smaller prepay (e.g. 3%, 2%, 1%).
Recourse:	Apartment loans may or may not require recourse (personally guarantee).
Closing costs:	Borrowers are responsible for all due diligence and closings costs (e.g. Appraisal, Phase 1 Environmental, site inspection, title, etc) Loans under $3M - costs range from $6,000 to $12,000 For loans over $3M - costs can be $20,000 or more

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Over $1.0 Million We'll shop for you RealWebFunds Commercial Mortgage will act as your full service broker to find and close your commercial loan. Our aggressive shopping of your deal will ensure you will get the best rate and terms on the market. More... Speak to a loan officer Call 800-930-2394

Under $1,000,000 Our partner can help Commercial Direct® specializes in loans up to $1,000,000. Up to 30 year fixed rates, up to 80% loan to value, unlimited cash out. Over $3B in fundings last year. Apply online or call 800-930-2394 option 2

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