Bank relationship pricing without borrower deposit requirement
LOS ANGELES, CA – Commercial mortgage broker FINANCIAL COMPOUND announces that the firm has arranged an $11.5 million loan to refinance a shopping center located in the City of Los Angeles. Financial Compound had been engaged by the owner, an experienced real estate investor, to structure the optimal financing package for the property.
Built in the 1970s, the property is a well-trafficked Los Angeles center that is fully-leased and anchored by investment grade credit tenants with leases expiring within the next 10 years.
Financial Compound procured a 10-year, fixed rate loan with a 3.90% interest rate and 25-year amortization schedule. The financing offers a low loan to value ratio and high debt coverage ratio with a prepayment penalty structure of 5, 4, 3, 2, 1 and then no penalty for years 6-10.
The lender fee was 0.40% and the closing costs were approximately $5,900. Furthermore, no banking relationship was required of the borrower; whereas 99% of commercial mortgage lenders would require a depository relationship to execute this type of transaction.
This borrower is a longstanding Financial Compound client and the company was able to clearly articulate to the bank the types of deals in the client’s pipeline and their financing desires. That bank is now working on a second low-interest rate, 10- year fixed-rate loan, and a banking relationship, as predicted by Financial Compound, has ensued.
Commenting on the transaction, a Financial Compound spokesperson said, “Now is a great time to borrow at historically low interest rates for long term fixed rate money. The interest rate obtained on this property was the lowest 10-year fixed rate our staff members have seen in their 16 years of closing deals.”
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