Bank & Credit Union Program
For Owner Occupied Use
Bank Program For Investment Commercial Real Estate
Banks and credit unions generally provide some of the lowest rates available in the market, making them attractive sources of debt for many businesses. These lenders will finance a broad range of property types and are usually flexible with uses of funds. Financing may be used to acquire, develop, construct, or rehab commercial property, as well as to refinance existing debt, or consolidate multiple loans. These lenders provide an assortment of products including fixed and variable rate structures.

Program Overview
Loan Amount: | $500,000 + |
Term Length: | Up to 15 Years |
Max LTV: | Up to 80% |
Amortization: | Up to 25 Years |
Interest Rate: | Starting in the 4%'s |
Closing Time: | 4 - 6 weeks |
Purpose: | Acquisition, refinance, cash out, construction, rehab / add on |
Pros And Cons Of Fannie Mae
Small Balance Loans
Pros
- Low Rates & Costs
- High Leverage (80% LTV)
- Long Amortizations (30-yrs)
- Cash Out Available
- Variety of fixed rate products
- Non-recourse
- Limited Personal Financial
- Flexible Prepayment Options
- Assumable & Streamlined
Cons
- Conservative Underwriting
- Sponsor Liquidity
- Requirement
- Longer Closing Process
- Property Must be Stabilized

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Pros and Cons
Pros
- Low rates
- Diverse property types
- Flexible underwriting
- Variety of loan programs
Cons
- Extensive documentation
- Full recourse
- Cash out refinances limited
What Do I Need To Qualify
- Good credit
- Years in business > 2 years
- Positive income & cash flow
- No prior defaults (e.g., foreclosures) or bankruptcies within last 7-years
Disclaimer: These are general qualifications. Other information might be considered during your application.
Eligible Properties

Office

Retail

Industrial

Hospitality

Medical Office

Restaurant
Other eligible properties include: Office condo, warehouse condo, marina, parking facilities & automotive
Common uses include: Purchase, refinance, cash-out, construction, renovate
Required Documents
Property Documents
- Current Rent Roll
- Last 3-Years of Operating Statements (P&L)
- Trailing 12-month Operating Statements
Personal Documents
- Personal Financial Statement
- Real Estate Owned Schedule
- Bio / Resume
- Proof of Liquidity (Bank Statements 3 Months)
Business Documents
- Operating Statements (2-Years)
- Current Rent Roll
- Trailing 12-Months Operating Statements
- Articles of Formation
- Bylaws / Operating Agreement
Required Documents
Personal Documents
- Personal Financial Statement
- Personal Tax Returns (3-years)
- Bio / Resume
For any owner with 20% or more ownership interest in the business.
Business Documents
- Profit & Loss Statement
- Balance Sheet
- Corp. Tax Returns (3-years)
- Bank Statements
Stated Income Case Study
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Fees and Costs
- Origination fees: 0% - 1%
- Third party reports: $2,500 - $5,000
- Legal & documentation: $2,500 - $5,000
- Closing costs: Based on loan amount and county
Fees and costs are estimates only based on historical data. Actual fees and costs may differ among lenders and will depend on a variety of factors, including property and complexity of the transaction.
Prepayment Penalties
For loans with long fixed rate terms, some lenders may require a prepayment penalty, which is typically tied to the rate and term it is fixed. If required, lenders typically use a declining balance (i.e., Step down) prepayment provision.
Timing
Getting from term sheet to the closing table is often a two-way street. Borrowers that promptly provide documentation and answer underwriting questions can dramatically speed up the closing process. While it is possible to close a loan in less than 30-days with a bank, the typical closing period is 6-8 weeks. Often times, the closing period is dependent on outside sources, such as property inspections or appraisals, so borrowers should be proactive with time provisions in purchase contracts.
Partial Occupancy
If the collateral property is only partially occupied by the business and the other portion is occupied by tenants, the lender will consider it “owner-occupied” if the business occupies 51% or more of the property. Otherwise, it is considered investment real estate, which has different underwriting criteria and loan programs. Regardless, the lender will include the rental income as part of the income generated to support the loan. Borrowers should expect to provide a rent roll and operating expense statements, as well as leases for the property as part of the underwriting process.
Borrower Entity
The borrower entity is the operating business. The business generally must have been in existence for at least 2-years. The ultimate property owner may be a holding entity owned by the business or the business owner and it will be a co-borrower and the mortgagor.
Recourse
Generally, any individual with at least a 20% or more ownership interest in the borrower should expect to provide full personal guarantee. In rare instances, or for lower leverage loans (under 60% LTV), non-recourse or limited recourse may be available with certain bank lenders.
Third Party Reports
Property related reports, such as an appraisal, property condition report, and a Phase I Environmental Report are usually required. These reports must be ordered by the lender. Borrower should expect to remit a cost deposit to the lender to cover the costs of these reports.

Approval Process
1. Create loan request here.
2. Supply preliminary documents.
3. Select a loan program and product.
4. Receive preliminary approval.
5. Review and accept term sheet; remit deposit.
6. Lender completes underwriting.
7. Loan approved. Final terms reviewed and accepted.
8. Appraisal and third party reports ordered.
9. Loan closed and funded.