Commercial Mortgage Indexes – December

In the Treasury market, shorter-term interest rates this week started to move above some longer-term rates. Monday (12/3) the 3-yr. Treasury yield moved above the 5-yr. yield,  and it was soon followed by the 2-yr. yield. This is the first time yields have inverted since 2007. That kind of bond market move may indicate that some of the more widely watched spreads could soon flip – an early warning sign of a recession. US Stocks plunged with the Dow Jones Industrial Average tumbling more than 800 points. As the yield curve continued to flatten, financial shares were hammered and investors bailed on bank stocks. Investors worried about the bond-market signaling a possible economic slowdown and that the Treasury events may hurt lending margins.

Links to this month’s rates:

Commercial Mortgage Rates – December

CommCap is the largest full-service mortgage banking company in Nevada, with offices in Reno and Las Vegas. We specialize in originating, underwriting, closing and servicing loans in excess of $1MM on all income-producing property types. We represent a wide variety of funding sources including Life Insurance Companies, Investment Banks (CMBS), Bridge Lenders, Agency lenders, and Banks. 
Agency Update(multifamily, mobile home parks, student housing, senior housing, affordable housing, etc.) Life Company Update(multifamily, office, retail, self-storage, industrial, etc.) CMBS Update(multifamily, office, retail, self-storage, industrial, etc.)
  • Fannie and Freddie Mac have a small balance program for deals $1MM- $6MM
  • Green Rewards provides up to 5% more proceeds than conventional and you will see a cost savings in spread
  • Mod-Rehab Products are offered by both Fannie and Freddie
  • HUD/FHA offer 35-yr. terms with 35-yr. amortization. Something to consider for people who plan to hold properties long-term
  • HUD offers construction-perm financing. Up to 85% LTC, non-recourse with rates similar to conventional. 40-yr., term/ 40-yr. am. This is for the long-term hold
  • 5, 7, 10, 12, 15 and fully amortizing terms available
  • 30-yr. amortization
  • Non-recourse
  • Our recourse based life companies will go as low as $1 million in proceeds compared to a minimum of $3 million for non-recourse life company lenders
  • Non-recourse and Recourse (for less conservative loan requests) available
  • Recourse is different from traditional recourse in that there is no mark-to-market language in the loan documents, hence there is no margin call. It does not go on your credit report
  • 65%-75% max LTV (non-recourse and recourse)
  • 3, 5, 7, 10-yr.… up to fully amortizing terms available
  • 25-yr. amortization
  • CMBS offers interest only depending on the leverage point
  • 75% max LTV (most CMBS lenders are underwriting max 70% LTV based B-buyer demand)
  • 5, 7, 10-yr. terms available
  • 30 yr. amortization
  • Non-recourse
  • Still the most aggressive lender for retail and office properties
  • Rate lock at application is available with no “material adverse change” language. There is a slight premium to the spread for the rate lock

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