Commercial Loans and Fun Blog

Repricing is defined as an increase in the interest rate of a commercial real estate loan after a term sheet has been agreed upon and after the third party reports have been completed.  Conduits are the commercial lenders most likely to reprice a commercial loan.

Some commercial mortgage lenders insist on fixed rate loans.  Other commercial lenders greatly prefer adjustable rate mortgages, when they can convince a borrower to take one.

Why would a commercial lender ever want to make a fixed rate loan?  Some lenders - like life insurance companies and pension plans - need to know exactly what they will earn in interest income over the next ten years.  The reason why is because life companies and pensions trusts need to make sure that they will have the dough to pay their death claims or retirement benefits.  These big companies employ actuaries (maths geeks with sharp pencils), who can tell them pretty accurately how many people will die or retire in a given year.

Conduits are specialized commercial lenders (or special departments inside of money center banks, like JP Morgan Chase, the largest conduit originator) that originate large, plain-vanilla commercial real estate loans destined for securitization.  By plain vanilla,  I mean permanent loans on the four major food groups - multifamily, office, retail, and industrial.  You will recall that a permanent loan is just a first mortgage on a commercial property with a term of at least five years and with at least some amortization (usually over 25 years).

You will also recall that a term sheet in commercial mortgage finance is a written expression of interest in making a loan and a good faith estimate of the eventual terms.  Term sheets are also known as loan proposals, good faith letters, or conditional commitment letters.

Now term sheets are legally worthless.  They are NOT commitment letters.  They are NOT binding on the lender.  That being said, once a commercial lender has issued a term sheet at a particular interest rate, the lender is almost always loathe to change the interest rate, as long as the commercial mortgage borrower has fully-cooperated and not dragged his heels.  I think this level of honor among commercial real estate lenders is a credit to our industry.

Ocassionally even honest and well-intentioned commercial lenders have to reprice their commercial loans.  Conduit lenders make their dough when they sell their fixed-rate permanent loans to a securitization trust at a premium.  A premium is when an investor buys a fixed rate bond (or mortgage) for more than the face value.

Example:  Morgan Stanley Capital Markets originates a $20 million conduit loan on a lifestyle center in Pittsburg - surprisingly one of the most successful cities in America.  By the way, a lifestyle center is a new type of large shopping center where lazy Americans can drive right up to the door of the store they want to visit, rather than needing to hike 300 yards down the center of an enclosed mall.  Assuming this new conduit loan is properly priced, Morgan Stanley might be able to sell this $20 million new commercial loan to the securitization trust for $21 million.  That extra $1 million is the 5-point premium earned by Morgan Stanley for originating the loan. Be careful:  I have no idea of the size of the premiums that conduits typically earn on deals.  I am just trying to help you understand the concept of a premium.

Okay, we are finally getting to the point of today's training lesson.  You will recall that we said that repricing is defined as an increase in the interest rate of a commercial real estate loan after a term sheet has been agreed upon and after the third party reports have been completed.  We also said that conduits are the commercial lenders most likely to reprice a commercial loan.

Recently the CMBS industry (the conduit loan industry) has been in turmoil.  When China suddenly devalued the yuan by 5% about six months ago, the credit markets got spooked.  Stock and bond markets worldwide began to make wild swings.  Volatility became the new buzz word in the field of finance.

This put the conduit industry between a rock and a hard place.  Remember, conduit loans are fixed rate loans because that's what the CMBS bond buyers (life insurance companies and pension plans) want.  But what happens to a small conduit when it prices a new loan at 4.4%, a rate that would ordinarilly produce a 5-point premium, only to discover at the closing 90 days later that the the loan needs to be written at 4.90%?!  That 5-point anticipated premium disappears!  To make matters worse, the conduit might even have to discount the loan (sell it at a loss).  Yikes!

Well, do you remember when I said that that terms sheets are NOT binding on the lender?  You guessed it.  That 4.4% conduit loan is going to be repriced to 4.90%.

Right now there is a lot of repricing going on.  I should go into the business of selling Tums to conduit owners.  I would sell a lot of them right now.

Do you need a commercial loan right now?

Even if you don't have a pressing commercial loan need right this moment, you still should go onto C-Loans.com and register.  That's a fancy term for just filling in your name and address.  As soon as you do, I will send you a free $199 commercial mortgage underwriting manual.

Keep your eyes out for the business card or the contact information of a banker making commercial real estate loans.  We'll trade you the contents of that one business card for a free directory of 2,000 commercial real estate lenders.

Be sure to subscribe to this blog to get free training in commercial real estate finance.  These blog articles are written with great love and care because they are my legacy to my two wonderful sons.  Congestive heart failure almost got me twice this year, so I am scrambling to finish the training of George IV and Tom.  By subscribing you'll be getting the same training as my sons.

You can also forward this blog article to a friend.

Location is far-far more important to commercial real estate lenders than home loan lenders.  In home loan lending, a borrower merely has to meet the lender's minimum requirements.  Once the borrower satisfies a home loan lender's minimum requirements (loan-to-value ratio, debt ratio, downpayment size, credit score, etc.), the home loan lender approves the deal.  The borrower doesn't get a better interest rate because the property is located in Beverly Hills, as opposed to a dangerous area on the South side of Chicago - home of bad, bad Leroy Brown.

In contrast to minimum requirements, commercial real estate lenders are cherry-pickers.  They  take the most attractive deals available until they have satiated their hunger for commercial mortgage investments.  An example of a high school dance will help to make this concept easier to grasp.

Okay, its the high school dance, and its a mixer.  Everyone arrives without a date.  The girls flock to one side of the gym, and the boys flock to the other.  Rocky Hupson, the handsome quarterback and captain of the football team (playing the role of MetLife in our metaphor), walks over and asks the beautiful Head Cheerleader to dance.  The commercial mortgage rates offered by MetLife, the nation's largest life insurer, are the lowest in the country.  MetLife can pretty much have any commercial loan it wants.

Then Bradley Pitt, the fiercely handsome star running back (playing the role of Prudential Life Insurance Company in our example) asks the second prettiest girl to dance.  And so on through the rest of the 180 life insurance companies.

Life insurance companies always have the lowest interest rates on commercial loans, so they are at the top of the CREF food chain.  They cherrypick the safest deals until they have used up their yearly allocations for commercial mortgage investments.  And that's a lot of dough.  Even though there are only about 180 life companies, they fund the really large commercial loans - deals of $5 million to $500 million.  Altogether life companies fund about 23% of all commercial loans - by dollar volume.

While we're on the subject of yearly allocations, its possible to bring an absolutely perfect commercial loan to a life company late in the year, only to find out that the life company has already used up its yearly allocation of commercial mortgage investments.  Your loan will have to wait until January of the next year to fund!

Okay, now back to the school dance.  Then Matlock Damon, the star middle linebacker (representing JP Morgan's conduit lending division) looks over the lovely ladies.  All of the cheerleaders have already been selected, but there are some lovely, athletic ladies from the girls' track team, so Matlock selects one of them.  Then the remaining 37 players on defense (representing the 38 major conduits) whirl in and charm the lovely ladies.

And so on through (3) the commercial banks; (4) the credit unions; (5) the non-prime lenders; and finally (6) the private / hard money money lenders.  Commercial lending is a pecking order, where commercial lenders, when its their turn, choose the most attractive commercial loans still available, until their demand for commercial loans has been satisfied.

Now we can finally get to the point of today's training lesson:  As the most handome and dashing man at the high school dance, life companies will only make their huge commercial loans on commercial properties located in terrific locations.  These locations are what is known as primary locations.

A primary location, in terms of commercial real estate finance, is one of the most desireable locations in a gateway city in terms of traffic count, accessibility, safety, and affluence of the neighborhood.  In other words, a lot of Lexus'es, Mercedes, and BMW's need to be driving by.  You will rarely find a life company lending in a city of less than 500,000 residents.

A gateway city is defined as a large, generally safe, metropolitan area, featuring at least one major universities and a socially vibrant city center, that is a beehive for commerce, immigration, and job creation. The typical gateway city enjoys a pro football franchise and/or a pro basketball franchise and an MSA containing at least 1,000,000 residents.  

Conduits, on the other hand, will regularly make commercial loans on properties located in secondary locations.  A secondary location is defined as a middle-class, less-commercially-active area in a large city or an affluent, vibrant, and desireable area in a smaller city.  A secondary location is typically a nicer-than-average location, but it is just not an incredible location.  Is there a lot of brass and glass around?  If not, you're not in a primary location.

Example:  The most affluent and desireable location in Fargo, North Dakota - where all the physicians and attorneys congregate to do business - would be considered a secondary location.

"Gee, George, this is all very subjective."  Yup.  That being said, when you find yourself in a primary location in a major city, you'll definitely know it.  

“I shall not today attempt further to define the kinds of material I understand to be embraced within that shorthand description (of "hard-core pornography")… But I know it when I see it…” -- Supreme Court Justice Potter Stewart

Here's a good layman's test:  You'll know you are standing in a primary location when you suddenly feel very, very poor.  Ha-ha!

All other locations in commercial real estate finance are know as tertiary locations.

Keep looking for the business card of any banker making commercial real estate loans.  We'll trade you the contents of that one business card for a free directory of 2,000 commercial real estate lenders.

Do you need a commercial real estate loan right now?  Submit your four-minute mini-app to 750 hungry commercial real estate lenders and watch them compete to give you the best deal.  And C-Loans is free!

During the real estate crash of 2008, there were a ton of broken condo's in Florida.  Developers would start new residential condo projects in 2007, and by mid-2008, the residential real estate market had completely collapsed.  The developer would build a 100-unit condo project, but he would only sell 35 of them.  The rest of them, usually several years later, would eventually be rented out as apartments.  Voila!  You have a broken condo.

The construction lender, almost always a commercial bank, is usually is forced to foreclose and ends up owning the 65 unsold rental units.  Typically the foreclosing bank will offer the 65 rental units for sale as a bulk sale.  Why a bulk sale?  Why not sell off the condo's individually?  Wouldn't the bank recover a lot more by selling off the apartment units individually?  After all, individuals condo's fetch far more (1.4x) per square foot than apartments.

In a few more paragraphs, I'll explain why.  For now, however, suffice it to say that all 65 units will almost always be sold off in bulk.  Your commercial-investment property client wants to buy these 65 rental units because they are almost brand new, and they were built with far more amenities than most apartment buildings.  The object today is to finance this broken condo.

For the reasons I will outline further below, few banks will finance broken condo's.  There are around 5,400 commercial banks in the U.S., and probably fewer than a 300 of them will touch a broken condo.  But some banks will indeed finance broken condo's.

Most banks which will finance the purchase of a broken condo will only do so if the borrower is acquiring a majority of the condo units.  This is important to the bank because the bank needs to  control the homeowners' association (HOA); otherwise the HOA might pass a rule detrimental to the bank, such as no For Sale signs on the property.  If your buyer is acquiring less than half of the condo units, you'll need to apply to a private money lender, like Blackburne & Sons.  We here at Blackburne & Sons absolutely love-love-love to finance broken condo's.

The best way to get a commercial loan from a bank on a broken condo is by using C-Loans.com. When you enter your commercial loan into C-Loans, you should apply for a standard first mortgage on an apartment building (please remember that - as an apartment building).  In the Special Issues section, be sure to write that, "This is a broken condo project.  My client is buying ____ units out of a total of ____ units."

If you don't have any takers for your particular project, be sure to write to me personally.  In the Subject line, please type:  "Need Help With a Broken Condo."

Okay, now let's go back and see why so many commercial lenders are freaked out about making commercial loans on broken condo's.  When a foreclosing construction lender takes title to a large number of unsold condominium units, it typically acquires the Special Declarant Rights and thereby become a successor Declarant.  Huh?  What on earth is a Declarant?

The Declarant is the person or entity that creates the original governing documents for the association. The Declarant is generally the developer of the project and usually reserves certain rights and powers to himself related to the sale of units in the project, extra voting rights, etc.

Okay, I kind of understand... But what are these Declarant's Rights that the developer is so desperate to reserve?

The Declarant's Rights are found within an association’s declaration. Here are some typical rights reserved by the declarant:

1. Promotion: This allows the declarant to maintain model homes, a sales office within an existing building or unit, construct a temporary building for housing of a sales office and erect advertising or signage promoting the project and the sale of units;
   
   
2. Construction: This allows the declarant to make alterations, additions or improvements to the property that it deems necessary or advisable for the project. This often includes landscaping and the storage of construction equipment and materials upon the property, without the payment of any fee;
   
   
3. Easement and dedication: Easement rights allow the declarant to provide access to the property to any governmental authority, public or other utilities serving any lot or unit. Dedication rights allow the declarant to dedicate or transfer portions of an association’s common area to a county, municipality or other governmental authority that has jurisdiction over the property;
   
   
4. Architectural control: This allows the declarant to formulate and bind all of the owners to certain standards governing the appearance of units/homes and the community as a whole;
   
   
5. Amendment: In addition to possessing the authority to add property to the development, declarants typically have the unilateral ability to amend an association’s governing documents. In addition, any amendments the membership wishes to pass are also typically required to be approved by the declarant. If the declarant does not agree and its approval is needed, an amendment to the association’s governing documents will fail;
   
   
6. Assessment payment exemption: Most declarations include an assessment payment exemption for the declarant. Often the obligation to pay assessments for a particular unit or lot does not commence until the declarant sells to a third party;
   
   
7. Assignment: The right to assign allows the declarant to transfer to a third party all or some of the rights granted in the declaration.

Source: http://www.keaycostello.com/collections/declarants-rights/

Okay, George, I now pretty much understand what a Declarant is and why he wants to retain his Declarant's Rights.  But why does a commercial lender give a hoot?

Let's suppose your bank finances a condo development, and the bank is forced to foreclose on a project that is not complete.  The pool hasn't been dug, and the garages are not completed.  As a successor Declarant, the lender is usually subject to all liabilities and obligations imposed by law on the developer, including unpaid assessments for the foreclosed units.

As a successor Declarant and a dealer (you sell more than 4 units per year), the lender is responsible for delivering a public offering statement (POS) to purchasers and is liable for any "omission of material fact there from if the lender had actual knowledge of the misrepresentation or omission or, in the exercise of reasonable care, should have known of the misrepresentation or omission."  In addition, as a successor Declarant and Dealer, the lender will be liable for breach of the implied warranties of quality with regard to those units sold by the lender and the undivided interest in the common elements attributable to those units. These warranty claims typically involve defective building envelopes and can cost millions of dollars and take years to resolve.

 Yikes.  I'm just a banker, not a builder.  I don't want to warrant that anything is free of defect.

The lender can avoid substantially all of these liabilities obligations by recording an instrument declaring its intention to hold the Special Declarant Rights solely for transfer to another person as part of a bulk sale of the remaining units to that person.  This option does not allow the lender to recover the higher revenues that may be available by individually selling the units.

Now you know why the bank will insist on a bulk sale.

Attention Brokers:  It is our hope that you will avail yourselves of C-Loans.com again and again; but first I just need you to register on C-Loans.  This does NOT mean clicking on one of the blue buttons and getting a freebie.  This means completed Step One of Six on C-Loans.  Basically you're just filling in your name and contact information.  We want you in a sprint start, so that you can immediately start entering your commercial loan request when you come across a live deal.

Therefore we are going to bribe you.  We will give you a free copy of my famous Commercial Mortgage Underwriting Manual.  But please, be fair.  We're giving you a $199 freebie.  Use your real email address!  Recently a bunch of folks have been using email addresses other than their main email address.  Basically they are giving me an email address for Junk Email.  

C'mon, guys, you and I only make dough when we close loans together, and I need to remind you from time to time-to-time that:

1. Blackburne & Sons makes loans on broken condo's;
   
   
2. We finance nudie bars and strip centers with X-rated book stores;
   
   
3. We will sometimes make non-recourse loans; and
   
   
4. We will allow the seller to carry back a second mortgage behind us.
   
   
5. Etc.

So please be sure to use your real email address  I promise you'll find our joke-filled newsletters entertaining.

Okay, suppose you're a commercial broker (you list and sell commercial-investment properties).  An investor client calls you up and asks, "I like that strip center that you showed me yesterday, and I'm crunching some numbers.  What are commercial mortgage rates today?"

C-Loans, Inc. has just built a very helpful new website at CommercialMortgageRates.co.  (Please note that we chose not to pay the extra $20,000 for the dot-com extension.  The extension is dot-co.)  The entire site is devoted to commercial mortgage rates.

The page that you want is this one:  Table of Current Commercial Mortgage Rates.  I update these commercial loan rates on a regular basis, and right now we are in a period of faily stable interest rates.  These rates will always be - if not precisely spot on -  very close to the commercial loan rate that you or your client will pay.

You may find this suprising, but the commercial loan rates of most commercial banks are usually within 25 basis points of each other.   You will seldom find Bank A quoting 4.75% and Bank B quoting 6.0%.  A basis point is just a fancy way of saying 1/100th of one percent.  Therefore 25 basis points is 25/100th's of one percent - or one-quarter of a percent (1/4%).  

I recommend that you bookmark this particular table right now.

But you're not done.  This helpful table only shows you the current commercial loan rates in the market.  It doesn't tell you anything about the expected amortization of your new commercial loan, the term, or the prepayment penalty.  Here is what you should quote your client:

Multifamily Loans:

Fixed rate, thirty-years fully-amortized, rate readjusted to market every 5 years, and a prepayment penalty of 3-2-1.  In layman's language, 3-2-1 means 3% in year one, 2% in year two, and 1% in year three.  The loan is open in years four and five.  This prepayment penalty pattern repeats every five years.  Open is just a fancy way of saying no prepayment penalty.

Commercial Loans:

Fixed rate, twenty-five years amortized, due in ten years, rate readjusted to market at the beginning of year 6, and a prepayment penalty of 3-2-1.  In layman's language, 3-2-1 means 3% in year one, 2% in year two, and 1% in year three.  The loan is open in years four and five.  Open is just a fancy way of saying no prepayment penalty.  This prepayment penalty pattern repeats in year six.

Conclusion:

You no longer have to track hundreds of commercial lenders to find the best commercial loan rate for your client.  You've learned that most commercial real estate lenders have commercial loan rates that are within one-quarter of a percent of each other.  All you need to do is bookmark this Table of Current Commercial Mortgage Rates.

Do you need a commercial loan right now?

"I am shocked - shocked I tell you - to learn that there is gambling going on in this establishment."  - Louie the loveable French police captain in from the classic movie, Casablanca.  I am shocked -  shocked I tell you - to learn that ten commercial mortgage brokers got shafted today out of a commercial loan fee larger than $10,000."  Next to my Practice course, this is the course that you simply must take.  I got so sick of being screwed out of loan fees that I went to law school at age 35, with two kids in diapers, graduated with honors, passed the Bar on my first attempt, and then never practiced law.  I make more money in the mortgage business.

Every year commercial mortgage loan demand plunges by 75% in April.  Our office phones stop ringing, and the place feels like a morgue.  This happens every year, without fail.

There are some important lessons to be learned from this, even if you are not in the commercial mortgage business:

1. Arrange for a line of credit in advance.  It is absolutely true that banks only want to lend you money when you don't need it.  If you actually need the money, the banks will sense your fear, and they won't lend it to you.  The smart businessman therefore applies for a loan when he doesn't need the money.  For example, commercial mortgage brokers usually make a lot of money between September 15th and November 15th.  It's our busy season, just like Christmas is the busy season for retailers.  One day in mid-October, when our business checking account was bulging with money, I asked our corporate officers to sit down with our banker and explain that April and early May are typically very slow periods.  We successfully negotiated a line of credit, which is renewed every year.  Because we did NOT need the money at the time of the application, and because we applied for this loan far in advance of our need, the banker was impressed with our planning and anxious to loan us dough.  So lesson one is:  Apply for your business loan when your accounts are flush with cash and far in advance of your needs.  Never let your banker smell fear.
   
   
2. Those of you who have visited C-Loans.com have no doubt played around with the blue buttons on our home page.  You probably downloaded our free commercial loan placement kit or one of our other free gifts.  In order to get these freebies, you filled out a little lead form, where we captured your contact information.  We then solicted you to allow us to make you a loan, or if the deal was not a fit for us, we at least added you to our newsletter list.  The web page that described the irresistible freebie is called a landing page.  Please take a moment and look at this landing page.  You will notice that it contains both the irresistible offer and the lead capture form.  Lesson two:  Your own website must also contain landing pages so that you can capture new leads and new contacts every day.  We use the software of a wonderful company named Hubspot.com to create these landing pages and to serve up the freebies.
   
   
3. Once you have captured hundreds and hundreds of contacts, you are ready for April.  There are a number of ways to generate commercial mortgage leads - Google ads, website ads, the Yellow Pages, magazine ads, TV advertising (poor idea), direct mail, newspaper ads, etc.  The best way by far, in my opinion, is list advertising.  I've enjoyed some success in business, and the single biggest reason is because once I meet someone, I always add him to my newsletter lists.  I do NOT advertise to strangers, but once I have met someone in the legitimate course of business, I stay in touch with them for decades.  Okay, April is coming.  What do you do?  The HUGE advantage of list advertising is that you can increase the frequency of your newsletters during slow periods.  For example, I normally advertise to my mortgage broker buddies every three weeks.  During slow periods, like April, I increase that frequency to once every ten days.  If I am really-really dying in the desert, I can even increase the frequency to once a week.  When you list advertise, you have that kind of control.

 Don't you wish that you made three times more money as a commercial mortgage broker?  When I go to trade shows, mortgage brokers often walk up to me, pump my my hand, and thank me for my wonderful nine-hour training course, How To Broker Commercial Loans.  But my best work is my new Practice Course, a course that is designed to take a struggling commercial mortgage broker and make him nicely profitable.  It's not one, single awe-inspiring trick, but rather 63 smart business practice tips, each of which is designed to make the broker 3% to 5% more effective.

Been screwed out of an $18,000 commercial loan brokerage fee yet?  Of course you have!  It happens to all of us.  Stop being a victim.

The moment you register on C-Loans.com, I'll send you a free $199 commercial mortgage underwriting manual.

If you run across the business card of a banker making commercial loans, I'll trade you a free directory of 2,000 commercial real estate lenders.  We solicit these guys to refer their turndowns to C-Loans.com.

Need a commercial loan?

There are 5,309 commercial banks in the United States.  There are over 35 conduits.  There are 7,165 credit unions.  There are 830 life insurance companies.  Most of these institutions make commercial real estate loans.

Nevertheless, if you look back at the commercial loans that you closed last year, you'll probably find that three or four commercial lenders closed more than 75% of your commercial loans.  These are the commercial lenders that feed you and your family.  Their closings pay for your kid's college tuition.  They are your bread-and-butter.  And you know what?  You're not alone.  This reality is also true for the vast majority of all commercial mortgage brokers and commercial mortgage bankers.

By the way, do you remember the difference between a mortgage broker and a mortgage banker?  A mortgage banker is defined as a mortgage company that either retains or sells its loan servicing rights.  As a result, mortgage bankers typically make a whole lot more money (on the order of ten times more) than the typical mortgage broker.  How many times have I told you that loan servicing income is where the money is?  It's the loan servicing income, stupid! (As a presidential candidate, Bill Clinton had a famous yellow Post-It Note over his desk, 'It's the economy, stupid!'")

The same truth also applies to commercial real estate loan officers for bank, conduits, and hard money commercial lenders.  The typical commercial real estate loan officer working for a direct lender closes 75% of his commercial loans for his six best brokers.  These brokers are his buddies.  He has a relationship with them.  They know what he needs, and they don't waste his time bringing him unsuitable borrowers.  He knows that when they show up at his door with a package that the deal is almost certainly do-able.

"Duh, I'm kinda 'tupid, but I think I want to be one of those six brokers."  You betcha!  You definitely want a relationship with your bank loan officer.  I be dying if I be lying:  I once had an incredibly successful commercial mortgage broker buddy who would bring two hookers and cocaine to his bank loan officer every time he brought him a loan package!  Nooo??!!!  Yup.  This mortgage broker knew the bank's apartment loan program so well that he knew the bank was going to approve the loan, so he brought along the "party favors" ahead of time.  A lot of borderline deals got approved this way.  (Sadly my buddy ended up a drug addict living outside a mission in the Tenderloin District of San Francsico, and the bank ended up failing.)  Please do not bring drugs or hookers to my own loan officers!  Ha-ha!

The reason I'm blogging on this subject tonight is because my sons, George IV and Tom (now both commissioned loan officers), are pretty envious of Alicia Gandy, our top performing loan officer.  Alicia is known as the Loan Goddess because she closes 60% of our company's commercial loans.  How does she do it?  What is she doing right?  How can my sons and you enjoy this kind of success?

Answer:  Alicia has a great working relationship with a half-dozen really successful commercial mortgage brokers.  These six brokers bring her a ton of great loans.  And for each one of these top-producing mortgage brokers, Alicia is no doubt one of their three or four top-producing commercial lenders.

Now we can finally get to the point of today's training article:  As a regular commercial mortgage borrower, commercial mortgage broker, or real estate broker, you need to develop a close working relationship with three or four commercial lenders.  It's all about the relationship.  Remember that old blog article I wrote about my final words to my sons.  "Commercial lenders close loans for their friends."  If you have never read this old blog article, you are missing out on a subject SO IMPORTANT that they were my dying words.

The following is admittedly self-serving, but there is a HUGE reason why you want to develop a close working relationship with my one of my loan officers: Tom Blackburne, George Blackburne IV, Alicia Gandy, or Ed Hupp:

Blackburne & Sons is one of the few commercial real estate lenders
that stayed in the commercial real estate lending market
EVERY DAY of the Great Recession.

We're different than other commercial lenders.  We are NOT a mortgage fund (although we sponsor two of them).  I don't like funds.  Instead, we syndicate every single commercial loan with a different group of private investors. And you know what?  Even if a horrible terrorist attack took place today, we could still syndicate the investors to fund your deal.  The rate would obviously have to be higher because of the fear factor, but there is some interest rate that would bring out the wisest private investors. 

Blackburne & Sons is the one commercial lender that is always in the market.  Since 1980.

Keep looking for bankers who are making commercial real estate loans.  We'll trade you the contents of a single business card for a directory of 2,000 commercial real estate lenders.  We solicit these bankers for their turndowns.

Registration is just a fancy word for typing in your name, address, etc.  We want you registered on C-Loans.com so that you'll be in a sprint start to enter your next commercial loan.  Here is our bribe, and its a sweet one!

Need a commercial real estate loan.  Don't hop from lender to lender, repeating the same work each time.  Instead use C-Loans.com.  It's free!

During the Great Recession, most commercial mortgage brokers starved.  Right now, however, is a GREAT time to be a commercial mortgage broker.  More commercial loans are ballooning this year than in any year in history!!!

The money in the mortgage business is in loan servicing fees.  They are TEN times larger than loan fees.  And the easiest way to start servicing loans?  Become a hard money lender.

Once upon a time Bill Badluck borrowed $2 million from a non-prime commercial lender on his office building. His lender was not a commercial bank, a credit union, or even a regular conduit making CMBS loans.  Instead his lender was one of these new commercial lenders making non-prime commercial loans, the same kind of sub-prime commercial loans that Bayview Financial used to securitize before the Great Recession.

A non-prime commercial loan is a commercial loan offering a long term, a fixed rate higher than a bank but lower than a traditional hard money lender, and an enormous prepayment penalty.  These loan requests are less than perfect, perhaps because the property is in a secondary location or because the borrower's credit score is not high enough.  Perhaps the tenants in the building are financially weak, like a tanning salon or a nail salon, or perhaps many of the existing leases all mature in the next year or two.  If the tenants don't renew their leases, the property could soon be 70% vacant.  There is something about the loan that is less than prime.

What's the difference between a non-prime commercial loan and a sub-prime commercial loan?  There is really very little difference.  Wall Street developed the new name because of the bad press associated with the word, "sub-prime", during the Great Recession.  The only real substantive difference is that non-prime commercial loans are fully-documented.  The non-prime lender asks for all of the same documents as a bank - financial statements, tax returns, leases, etc.

Okay, now back to Bill Badluck and his bad luck.  Unfortunately Bill loses a number of his office tenants, and because he's not bringing in much money from the property, he falls behind in his payments.  The non-prime lender starts to foreclose.

Suddenly the U.S. Cavalry arrives and rescues Bill from the... Native American warriors justifiably defending their own homeland from the evil incursions of the European-Americans.  The nearby church school wants to expand, and it has offered Bill $600,000 for his excess parking.  Bill doesn't even use that extra parking area. He has far more parking spaces than what is legally required by the city.

Bill calls the loan servicing department of his non-prime commercial lender and tells them, "Listen, you guys are about to foreclose on my building and take a huge haircut (loss on a loan or investment).  Just allow me to release the extra 1.3 acres, and we can apply that to my loan.  With my loan paid down to just $1.4 million, I will easily be able to make your payments."

The condescending little bureacrat in the loan servicing department says, "I'm sorry, sir.  That's a business decision.  We're not allowed to make business decisions."  "Are you crazy?" asks an exasperated Bill.  "If you continue to foreclose on this building, I am going to stop making repairs.  The tenants will all move out, and once the building is empty, it will be stripped of copper within a week.  You guys will inherit an empty shell, and you'll lose $1 million."  Surprisingly the little bureaucrat replies, "I believe you, Mr. Badluck.  Every time we foreclose on a property, we lose our shirts.  I know this sounds ludicrous, but releasing that extra acreage from our mortgage is a business decision, and we are not allowed to make business decisons."

What the fudge?   Aghhhh!

Indira Investor is pretty wealthy.  Her deceased husband was a renown surgeon, and they invested well.  She owns a shopping center on the premier commercial strip in town, and this shopping center has a vacant pad right on this busy thoroughfare.  McDonalds has come to her and offered to lease the pad for 30 years at a terrific rate.  Indira simply has to build a new restaurant building to company's plans and specifications.

The new building will cost $900,000.  Fortunately, that is not a problem because she has the extra cash just sitting around.  Unfortunately her attorney has spotted a covenant (fancy word for promise) in the her $5.2 million conduit mortgage documents that forbids her from making any changes to the property.  Huh?

Indira calls the loan servicing department for the conduit and explains her situation.  The pad is unused, and Indira will be paying for the new building herself.  Once completed, McDonald's will be paying an extra $21,000 per month.  This will benefit the conduit's security position immensely.  Intead of the shopping center being worth $7.3 million, it will now be worth $9 million!

"I'm sorry," says the sympathetic agent in the conduit's loan servicing department.  "I understand that granting you permission to build will only improve the conduit's position, but we cannot grant you that permission.  Granting you permission to build is a business decision, and we are not allowed to make business decisions."

What the fudge?

Okay, here is what is going on.  If your company - probably an LLC - made a ton of money last year, and you didn't suck it all out in salary and bonuses to yourself, your LLC will have to pay income taxes.  Corporations, limited liability companies, and irrevocable trusts are all responsible for paying income taxes, just like a natural person.

When a portfolio of commercial real estate loans are securitized, they are put into an irrevocable trust.  Bonds, backed by these first mortgages, are then issued by the trust and sold to investors - typically pension plan and insurance company investors looking for a fixed rate yield.

When the loan payments come in to the irrevocable trust, the trust first has to pay income taxes of around 50% to the government.  Therefore if the mortgages in the trust were earning 5%, half of those earnings would have to go to the Federal government in taxes.  Therefore the trust would only have 2.5% interest to distribute to the bond investors.  Then the bond investors have to pay 50% of that interest in their own income taxes, so they would only net ...

What?  Huh?

I'm pulling your leg to make a point.  In order to excuse the irrevocable trust from having to pay income taxes on its mortgage interest - thereby creating double taxation - Congress created the passthrough trust. As long as the irrevocable trust just passes through all of its net income to the bond investors, it will NOT be subject to income taxes.

But there is a catch.  In order for the irrevocable trust to maintain its status as a passthrough trust, the trust must not behave like a for-profit entity.  It must NOT make any business decisions, even if by failing to make a business decision the trust loses millions of dollars.  If it makes a business decision, the trust loses its tax-free status!  All a passthrough trust can do is follow exactly the instructions contained in its Trust Agreement.  Passthrough servicing trusts are often forced to make the most absurd of decisions.  They have zero flexibility.

Non-prime commercial lenders can offer lower interest rates because these commercial loans are all securitizied and rated.

But remember, if you accept a loan from a conduit or a non-prime commercial lender, you are putting yourself in a straightjacket.  You cannot divide your property and sell off a piece.  You cannot legally improve your property.  You cannot place a second mortgage on the property to get at the equity that has accumulated.  You cannot refinance the property for five years because of the lock-out clause (absolute prohibition against prepayment).  After five years you still cannot refinance the loan because the prepayment penalty is enormous (almost beyond belief).  

You will also find it hard to sell the property.  The buyer cannot use a second mortgage or a mezzanine loan.  He must put down cash-to-loan.  If there are only two years left on the non-prime loan, any buyer will not only have put down an enormous downpayment, but he must avoid getting freaked out by the fact that he will have a huge balloon payment due in just two years.  Good luck finding such a buyer.

At first blush, non-prime commercial loans and conduit loans sound great because of their low interest rates.  In truth, however, they are horrible loans that you will soon regret.  You will be held in a straightjacket for an entire decade.  Commercial loans from banks and private money lenders - like Blackburne & Sons - are far better because they have no prepayment penalty.

Keep looking for banks making commercial loans.  You can swap the contents of just one banker business card for a directory of two thousand commercial lenders.

Get a free $199 commercial mortgage underwriting manual, just for taking two minutes to register (filling out your name, address, etc.) on C-Loans.  We want you in a sprint start to enter your next commercial loan.

This is the best time in history to become a commercial mortgage broker because over $100 billion in commercial loans are ballooning this year.

Have you ever wondered what the difference was between preferred equity and a mezzanine loan?

If you have learned a few things today, and you want to continue to learn more about commercial real estate finance (CREF), subscribe to this blog.  It's free.

There are two different ways to analyze commercial loan production - the total dollar volume of commercial real estate loans and the number of individual commercial real estate loans made.  From now on, whenever I say "commercial loans" I really mean "commercial real estate loans".

In terms of total dollar volume of commercial loans, the life companies, the conduits, and the ten largest money center banks combined probably originate about 60% of all commercial loans.  This makes sense.  These behemoths make the really huge commercial loans - the deals over $5 million.  Commercial loans of $40 million+ are not unusual for these Big Boys.

However, in the land of mortals, where you and I reside, the small banks (under $1 billion in assets) and the regional banks (under $30 billion in assets), make the vast majority of individual commercial loans; i.e., they make the largest number of commercial loans.  In plain English, small banks and regional banks make thousands and thousands of small balance commercial loans.  A small balance commercial loan is one that is less than $5 million.

In contrast, the life companies, the conduits, and the money center banks combined might only make a paltry 600 major commercial loans in an entire year.  Therefore small banks and regional banks are where you and I will place most of our commercial loans.

I have also often told you that you must match the size of your commercial loan request to the size of the bank.  In other words, take your small commercial loans to small banks and your large commercial loans to large banks.

It also helps immensely to bring your commercial loans to the banks located close to the subject property.  Most banks greatly prefer to lend in their own backyard; i.e., to make local loans.

To find the perfect lender for a commercial loan, I like to go to maps.yahoo.com and type in the address of the commercial property that I am trying to finance.  The property will be flagged on a map.  Then in the field entitled "Find a Business", I type in "Banks".  Yahoo will then plot all of the banks and credit unions (credits unions love commercial loans these days) located close to the subject property.  I then submit my deal to these local banks.

"Okay, George, that all sounds great and everything, but how on earth am I going to know the size of a particular bank?  Let's suppose I'm doing a commercial loan in far off Arkansas, and the Bank of Arkansas shows up as having a branch close to my property.  Is the Bank of Arkansas a small bank or a large regional bank?  Will my commercial loan request be too large?"

To find the size of any commercial bank, simply go to BankFind, a wonderful tool developed by the FDIC.  Type in the name of the bank and then press "Search".  When the bank comes up, click on the Financials tab to see the asset size of the bank.  Be sure to bookmark this great tool right now.

We are now finally getting to the point of today's training article.  Regulators want banks to have a diverisified portfolio of loans, not just one giant loan upon which the bank rests all its hope.  Can you imagine the risk to the financial system if a $250 million bank were to make a single loan of $250 million on an office tower in New York City?  Banks are therefore limited as to the size of any single commercial loan that they can legally make.

It is much easier to place a commercial loan if the loan amount is well below that bank's maximum loan size limit; otherwise the Board of Directors will be wringing its hands and demanding an absolutely perfect loan.  In the history of mankind, there has never been an absolutely perfect commercial loan.

So what is the maximum commercial loan size that any particular bank can make?  It all depends on the asset size of the bank.  The assets of a bank are its cash on hand, its cash on deposit with the Fed, and its investments, which includes all of its outstanding loans.  As I have shown you above, you can easily find the asset size of any commercial bank in America using BankFind.  By the way, the liabilities of a bank are its customer deposits, which have to be paid back upon request.

Now Federal regulators require a bank to have a capital account equal to at least 6% of assets, and most banks enjoy a capital account of between 6% to 8% of assets.  The capital of a bank is the sum of the dough the founders originally put into the bank plus all of its accumulated retained earnings (profits that the bank has made and not yet sucked out).  A well-run bank operates fairly close to that 6% number because it maximizes the profit to the stockholders.

Example:  The Bank of Arkansas has $250 million in assets (found on BankFind).  What is its minimum capital?

Minimum Capital = Total Assets x 6%

Minimum Capital = $250,000,000 x 6%

Minimum Capital = $15,000,000

Hilarious note:  I picked the name Bank of Arkansas out of the blue, but it turned that there really was a Bank of Arkansas.  Unfortunately, probably during the Great Recession, the bank took so many losses that its capital dipped below 6% of assets.  The Feds closed the bank down!

Just in case you've forgotten, we're trying to find out the largest loan that the Bank of Arkansas is allowed to make.  This is a gross simplication, but in general, the maximum loan that any bank can make to a single borrower is 15% of its capital.

Example:  To find out the largest loan that the Bank of Arkansas can make, assuming it hadn't crashed and burned during the Great Recession:

Maximum Legal Loan Size = Bank Capital x 15%

Maximum Legal Loan Size = $15,000,000 x 15%

Maximum Legal Loan Size = $2,250,000

Therefore, if you needed a $3 million commercial loan, you would probably wouldn't apply to the Bank of Arkansas.  In practice, I would limit the size of my commercial loan request to just 60% of a bank's maximim loan size limit; otherwise the Board of Directors is likely to be all freak-deaky, picking at every flaw.

It's time for you to finally learn commercial real estate finance.  You can learn most of it in one long day (9 hours).

If you can't afford $549, you should at least download my free $199 Commercial Mortgage Underwriting Manual.  All you have to do is register on C-Loans.com.  (Once you've registered, you're far more likely to enter your next commercial loan into C-Loans.com) 

Be sure to save the business card of any banker you meet who makes commercial loans.  You can parlay the contents of that business card into a free directory of 2,000 commercial lenders.  (We solict these guys to refer their turndowns to C-Loans.com.)

Need a commercial loan?  Why not submit it to the hungry 750 commercial lenders on C-Loans.com?

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Suppose you are trying to refinance your client's balloon payment on his office building, but you run out of time. At the advice of his attorney, he files a Chapter 11 Bankruptcy. The moment he does this, the foreclosing lender becomes subject to an automatic stay. In other words, the foreclosing lender must immediately freeze in his tracks. "Sit, Oboo. Stay!" He can't call and harangue the borrower, nor can he continue his foreclosure until a bankruptcy judge grants his Motion for Relief From the Automatic Stay. (C'mon, Judge, let me finish off this foreclosure.)

If this was a Chapter 7 Bankruptcy - a complete liquidation of the debtor's assets in order to (partially) repay his creditors - a bankruptcy trustee would be appointed to marshal the debtor's assets. Liquidation is just a fancy legal term that means "sell the asset and convert it into cash". A bankruptcy trustee is typically an attorney paid by the court out of the assets of the debtor's estate (and who almost never returns phone calls). To marshal the assets means "to gather up the stuff that the debtor owns", like a French general assembling his troops before he attacks.

Sometimes it is not necessary to sell off everything that the debtor owns in order to satisfy his creditors. Sometimes the debtor just needs some time to reorganize his assets; i.e, to sell off some assets (maybe a rental house or a valuable stamp collection) or to refinance some buildings. In such a case, your borrower will merely file a Chapter 11 Reorganization Bankruptcy

Even though a bankruptcy trustee will still be appointed in a Chapter 11 case to be the eyes and ears of the court, title to all of debtor's assets still remains in the name of the debtor.  This is in stark contrast to a Chapter 7 Bankruptcy. In a Chapter 7 case, the instant the debtor files his bankruptcy, his assets immediately become the property of the bankruptcy estate.  This is why the debtor in a Chapter 11 Bankruptcy case is often called a debtor-in-possession.  He still technically owns his stuff.

In our imaginary example, your client is now in bankruptcy. He needs to find a commercial lender who will refinance his balloon payment while he is in bankruptcy, thereby allowing him to dismiss his Chapter 11.  Unfortunately very few commercial banks (practically none) will finance a debtor who is in bankruptcy, even if the cause is merely being late to pay off a balloon payment.

The debtor needs to find a bridge lender to refinance his balloon payment.  Once the ballooning loan is paid off and the Chapter 11 Bankruptcy has been dismissed, then the debtor can go back to an understanding bank and refinance the more expensive bridge loan with a cheaper bank loan.  Blackburne & Sons (my own firm) is an example of a private money lender that will make commercial real estate loans to debtors in bankruptcy.

Okay, so you find the debtor a commercial lender willing to make him a quick loan to pay off his ballooning commercial loan, even though your debtor is still in bankruptcy. You can now simply trot your commercial borrower down to the title company and have him sign off, right?

No! If a borrower is in bankruptcy, the new lender needs the bankruptcy court's permission to make the debtor a new loan. "But the bankruptcy trustee said it was okay!" The bankruptcy trustee's permission is not enough. Lots of small hard money shops make this mistake.  They get the bankruptcy trustee's permission to refinance but not the court's permission.  No commercial mortgage loan signed by the debtor in bankruptcy is enforceable unless the bankuptcy judge has signed an order granting the debtor permission to sign the loan documents.  The debtor's bankruptcy attorney will handle this order in a motion format that includes the term sheet of the commercial lender (Blackburne & Sons).

Earlier I used the term debtor-in-possession.  This is the debtor in Chapter 11 who retained title to his stuff.  There is a special kind of bankruptcy financing called debtor-in-possession financing (DIP Financing).  This refinance of a past-due balloon payment by Blackburne & Sons is technically NOT debtor-in-possession financing.  Why?  Because when we close our refinance, the debtor is no longer in bankruptcy.  We've paid off the balloon payment, so the debtor has no reason to remain in bankruptcy.  The bankruptcy is dismissed.

Anybody out there know the difference between a bankruptcy discharge and a bankruptcy dismissal?  When you dismiss a bankruptcy, you're saying that the time-out is over.  The automatic stay of your creditors is instantly lifted.  Oboo no longer has to keep sitting.

In contrast, debts are discharged in a Chapter 7 Bankruptcy.  They are wiped out.  The debtor no longer owes those debts.

Okay, now let's finish up with debtor-in-possession financing.  (Blackburne & Sons makes these commercial loans too!).  DIP Financing is when the debtor stays in the Chapter 11 Bankruptcy, and some existing lenders are forced to subordinate to a fresh injection of cash.

Example:  The Blackburne Bakery has been in business for 50 years.  We make good money.  Sadly one of our bakers chops off a finger, and the finger ends up in the pie of Nervous Nellie.  Nellie bites down, swallows half the finger, and then faints.  Even though it was healthy protein, the jury awards Nellie the Swooner a whopping $750,000.  In the meantime, our reputation is temporarilly damaged, and sales plummet.  (My goodness, it was just a finger!)

Unable to make payroll, the company president puts the bakery into a Chapter 11.  The good news is that our specialized pie factory is huge, and we only owe $500,000 against it.  The bakery needs $750,000 to pay Nellie, $250,000 for payroll, and another $300,000 to carry the bakery until all of our loyal customers forget that our baked goods come with surprises inside.

If a lender made the bakery a $1.3 million new first mortgage on the factory, and the existing first mortgage holder was ordered by the bankruptcy court to subordinate, this would be an example of debtor-in-possession financing.

Here's a great deal for you:

Are you registered on C-Loans yet?  Here's the reality.  You are far more likely to enter a new commercial loan into C-Loans.com if you have already registered on the site (filled in your name and address).  In order to bribe you to finally register on the site, I will send you a free copy of our $199 Commercial Mortgage Underwriting Manual if you register.

Keep looking for the business card of a bankers making commercial real estate loans.  We'll trade you the contents of just one business card for a free directory of 2,000 commercial real estate lenders.  We solicit these bankers to refer their turndowns to C-Loans.  Or you can buy this same directory here for $39.95.

In the 300-year history of commercial real estate finance (CREF), there has never been a better time to be a commercial mortgage broker.  More commercial loans are ballooning in 2016 than in any year in history.

Everybody loves atta-boys.  If I've taught you a little today, how about a Facebook share, a Google Plus one, a re-Tweet, or a Linked-In share?  Thanks so much!  :-)

What is a money center bank?  You've heard me use the term before, as in the statement in my recent blog article about securitized commercial loans, "The money center banks - huge banks like Bank of America, Wells Fargo Bank, J.P. Morgan Chase - and the conduits would originate about $1 billion worth of commercial first mortgages on the four major food groups: multifamily, office, retail, and industrial properties."  But what turns a garden-variety commercial bank into a money center bank?

A money center bank is defined as a very large commercial bank, usually headquartered in a gateway city, which earns a substantial portion of its revenue from transactions with governments, big businesses, and other banks.  A large share of the deposits in money center banks come from foreign investors and foreign companies.  It is this access to foreign capital that gives money center banks an essentially unlimited access to capital.

Most money center banks have either their headquarters or a major footprint in such economic hubs as New York City, Los Angeles, San Francisco, London, Zurich, or Hong Kong.

Examples of money center banks include JP Morgan Chase, Bank of America, Citibank, Wells Fargo, US Bank (a lot of Asian deposits), Bank of New York Mellon, HSBC (London), Deutsche Bank (Frankfurt), and Credit Suisse (Zurich).

What makes money money banks so special - in addition to their access to virtually an unlimited amount of foreign capital - is that they help to sell U.S. Treasuries.  Have you ever wondered why only Lehman Brothers (an investment bank rather than a money center bank) was allowed to fail during the Great Recession?  At one point most of the money center banks and all of the major investment banks (think stock brokers) were technically insolvent.  Why not let them all fail and finally be done with them?  Without the money center banks and the major investment banks, there would be no one left to sell U.S. government bonds!

Okay, as commercial real estate investors and brokers, why do we even care about about money center banks?  Answer:  They are the lenders who have the dough to make the really large commercial construction loans.  If you need to build a residential tower in Brooklyn or a regional distribution center for Amazon.com or Wal-Mart outside of Houston, these are just about the only lenders who are perfectly comfortable making $50+ million loans.

Considering that these banks have an (essentially) unlimited deep pocket and a huge appetite for good loans, you can understand why they greatly prefer BIG loans.  They are not going to be terribly interested in a $400,000 commercial loan to buy a bar in Trenton.

Here is a great piece of advice:  Match the size of your commercial loan to the size of the bank.  Take small commercial loans to small banks and large commercial loans to large banks.

What is a small commercial loan?  Anything less than $2 million is know as a small balance commercial loan.  Take such loans to small banks.  What is a small bank?  Any bank with less than $1 billion in assets.

Take your mid-sized commercial loans to mid-sized commercial banks.  What is a mid-sized commercial loan?  Any commercial loan between $2.1 million and $10 million.  What is a mid-sized bank?  Answer:  Any bank between $1 billion and $10 billion in assets.

Take your large commercial loans to large banks.  What is a large commercial loan?  Any commercial loan larger than $10 million.  What is a large bank?  Any bank with more than $10 billion in assets. 

"That all sounds great, George, but how could I possibly know the asset size of a bank?"

You can quickly find the asset size of any bank in the country using BankFind, a wonderful search engine created by the FDIC.  (Loan Officers for Blackburne & Sons, please click on this link and bookmark BankFind right now.  Then please send me an email that says, "I bookmarked this tool.")

As you go about your business, be sure to hang on to the business card of any banker you meet who makes commercial loans.  You can parlay the contents of that one business card for a list of 2,000 commercial real estate lenders.  We solicit these bankers to refer their turndowns to C-Loans.  Or you can just buy that list for $29.95.

Do you have an "A" quality commercial loan that is simply too squeeky clean for my private money mortgage company?  You can run your commercial loan by 750 different banks with one click using C-Loans.com. And C-Loans is free!

The following scenario plays out all of the time:  

Two commercial mortgage brokers are competing to place a commercial loan for the same borrower.  The borrower wants the best rate possible, but ultimately he needs the money pretty soon to pay off some overdue company bills.  The rookie mortgage broker stubbornly keeps submitting the deal to banks, who keep turning him down for admittedly goofy reasons.  The veteran mortgage broker also has several banks looking at the commercial loan package; but just to be SURE he has some loan for his borrower (remember, this borrower needs money), he also submits the deal to Blackburne & Sons.  After all, Blackburne & Sons doesn't charge a penny to prepare a (conditional) commitment letter.  Sure enough, all of the veteran's banks flake out on him too, but the veteran ends up closing the deal and earning a nice commission because the borrower decides to accept the SURE DEAL on the table from Blackburne & Sons.  You submit your commercial loans by email anyway.  It will take you just three minutes to also submit a duplicate copy to the one commercial lender who is always in the market and always in the mood to make commercial real estate loans.  Blackburne & Sons was in the market every day of the Great Recession.

Did you learn something today?  Am I helping you?  Everybody appreciates atta-boys.  :-)  How about a Google-plus one, a Linked-In share, a Facebook share, or a ReTweet?  Maybe you might even forward this article to one of our buddies in commercial real estate investment or commercial real estate finance.  I sure would appreciate it.  

And thanks for your kind words of support during my heath scare!!  All appears well right now.