Insurance companies are asset allocation lenders, and they make commercial and multi-family real estate loans that they hold on their books as long-term investments. They play a significant role in the lending market, as they manage the amount of money they invest into real estate loans as a percentage of their overall investment portfolio. Throughout the unpredictability of the COVID-19 environment, insurance companies have continued to be a low-price lender while providing certainty of execution for borrowers. One misconception about…

In an effort to keep our customers up to date with current market trends, the following is an update for each sector of the lending market. Insurance Companies As we move deep into the 3rd quarter of the year, most insurance companies have plenty of allocated funds left to lend in 2020. Most insurance companies are not only looking at historical operating history when assessing new lending opportunities, and they are also taking a hard look at the current rent…

When shopping for a commercial mortgage, borrowers often focus on interest rates and fees. Though interest rate and loan fees should never be overlooked, borrowers can lose sight of their business plan for the property and how a prepayment penalty or lack thereof will affect its profitability. The outline below is an explanation of typical available prepayment penalties, along with the pros and cons of each. Prepayment Options Defeasance is the substitution of collateral. US securities can be structured to…