Date post: | 23-Jan-2017 |
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Everything You Need to Know About Small Multifamily Lending $1,000,000 to $5,000,000 Loans
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Today’s Speakers
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Dustin Pevear - SpeakerVP, Operations & Processing
Michael Noll – SpeakerOriginator Sales Associate
Charles Ostroff — ModeratorSVP, Chief Underwriter & Credit Officer
Arbor & Small Multifamily Loan Lending
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• As a national direct lender that provides debt capital for the multifamily and commercial real estate industries, Arbor partnered with Fannie Mae to develop the first ever agency Small Balance Mortgage Loan program two decades ago.
• In 2015, we were one of a few select lenders asked to participate in Freddie Mac’s Small Balance Loan program.
• Today, we are one of a select few lenders offering Freddie Mac and Fannie Mae small loans nationwide.
What is a Small Multifamily Loan?
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Small balance multifamily lending has quadrupled since 2009 from $11.1B to $44.3B.
Currently, the small balance market represents 65% of multifamily loans and 20% of overall multifamily volume.
In 2013, for example, 46% of all multifamily loans were less than $5 million each.
Fannie Mae Small Loan
• Up to $3M Nationwide. Up to $5M in Strong Markets
Freddie Mac Small Balance Loan (SBL)
• Up to $5M Nationwide. Up to $7.5M in Top and Standard Markets (subject to affordability calculations)
* Source: Chandan Economics, 2016
Key Stats*:
Benefits of Small Multifamily Loans
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Non-Recourse
Pre-Payment Flexibility
Interest-Only
Reduced Fees
Expeditious Processing
1
2
5
4
3
Small Multifamily Loan Program Summaries
8
• IO (5, 7, 10 year)
Interest Only – Full Leverage Options
• Max LTV – ACQ/REFI• Min DSCR
Maximum Leverage
• Max LTV• Min DSCR
Full Term Interest Only
Fannie Mae Small Loan & Freddie Mac Small Balance Loan Options
Arbor & Fannie Mae Small Loan Case Study
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REFINANCE• 32 units in Buffalo, NY• $2.67 million loan• $1.4 million cash-out• 7/6 ARM
Cash-out is used to pursue other real estate investments, recoup equity, and further improve real estate assets.
Arbor & Freddie Mac SBL Case Study - Oregon
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REFINANCE• 42 units in Portland, OR• $3 million loan• $1.5 million cash-out• 5-year hybrid ARM• 1-year interest-only
PURCHASE 1• 22 units in Portland, OR• $1.3 million• 7-year hybrid ARM• 2 years interest-only
PURCHASE 2• 20 units in Portland, OR• $1.3 million• 5-year hybrid ARM• 1 year interest-only
PURCHASE 3• 26 units in Portland, OR• $1.3 million• 7-year hybrid ARM• 2 years interest-only
Checklist for Getting Started
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Rent Roll
Historical Operating Statements
Financial Statements
Real Estate-Owned (REO) Schedule
Property Details
Purchase & Sale Agreement (ACQ)
Cost Basis/Length of Ownership (REFI)
Meet ALEX (Arbor LoanExpress)
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The commercial real estate industry’s first agency online lending platform for brokers, borrowers, and correspondent lenders.
Benefits of ALEX
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Faster Loan Evaluation
Accessible & User Friendly
E-Signature
Streamlined Documentation
Real-Time Diligence Tracking
Audience Q & A
Dustin Pevear - SpeakerVP, Operations & Processing
Michael Noll – SpeakerOriginator Sales Associate
Charles Ostroff — ModeratorSVP, Chief Underwriter & Credit Officer
The floor is open to submit questions in the ‘Questions’ tab of your control panel.
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Small Multifamily Loan Research
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For the latest on the small balance landscape, be sure to download our Q2 2016 Small Balance Multifamily Investment Trends Report.
www.ArborLoanExpress.com/2Q16MultifamilyInvestmentTrends
Stay Informed with ALEX Chatter
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For the leading source of small multifamily news, research and insight, visit ALEX Chatter.
ArborLoanExpress.com/chatter
Thank You – Let’s Stay in Touch
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Thank you for joining us today. This concludes our webinar.
Didn’t get to your question? Let’s get in touch. You can email us at [email protected]
Have any financing questions? Speak to a
loan officer one-on-one
Want to learn more about Arbor?
Visit Arbor.com
(844) 253-9397or visit
Arborloanexpress.comArbor.com