Welcome to our Learning Center. Below you will find helpful articles to help you understand the many intricacies related to investing in commercial real estate and commercial mortgage financing. There are a lot of articles that discuss investing in, and financing, multifamily properties, as apartment and multifamily buildings are a popular start for investors looking to invest in commercial real estate.
We continually add helpful information to this page, so check back often to stay up to date on market trends.
If you’re interested in obtaining financing for your multifamily building, it’s crucial that you understand what commercial mortgage underwriters look for. The lending industry as a whole has changed a lot over the past decade and commercial lending has not been an exception. This article will detail some of the most important things to consider before submitting your multifamily loan for approval. [...]
Freddie Mac is one of the biggest sources of multifamily loans in the country. In October 2014, they announced the addition of their Small Balance Program (SBL) apartment financing. The SBL program finances loans between $1 million and $7.5 million (although in the commercial real estate world “small loans” can often refer to loans under $15 million). Freddie Mac purchases loans from lenders and securitizes pools of over $400 million. Since their inception, they have funded over 10,385 loans totaling over $27 billion in volume. This blog post will introduce you to some of the basic criteria, details and highlights of the Freddie Mac SBL program. [...]
The entire world has been shaken up by the COVID-19 pandemic. As the number of worldwide cases approach 9 million and the number of deaths is closing in on 470,000, everyone around the globe is highly anxious for the day when life can just go back to normal. Likewise, the global economy has taken a huge hit over the past few months. In specific, the travel and hospitality industry has been decimated. [...]
Many investors new to commercial real estate have trouble getting a handle on the various metrics used in the industry. In fact, there are some experienced professionals who don’t actually have a clear sense of how to define these metrics. The DSCR or debt service coverage ratio is one of the most fundamentally important concepts in the commercial mortgage space. When it comes to financing your property, every commercial lender will utilize this metric. It therefore behooves you as an investor to really understand what DSCR is all about. If you don’t feel completely comfortable with this topic, this blog post is for you.[...]
Commercial real estate owners and buyers are always confronted with the same question: “How do I determine the value of a commercial real estate property?” Homeowners and homebuyers rely on the market data approach which simply looks at comparable sales in the market to determine value. Commercial properties rely more heavily on the income approach or the income capitalization method to determining value. [...]
What Commercial Mortgage Lenders Look for When Qualifying Borrowers and Determining Rate. [...]
There are many different types of lenders making investment property loans. Who are these lenders, and which is best for your particular needs? [...]
Lenders look at many factors in determining whether to approve or reject an investment property loan. Underwriters will investigate the personal qualifications of the borrower as well as the fundamentals of the subject property. Some of these factors include [...]