Request: 67% LTV refinance to payout current 1st and 2nd mortgage plus property taxes arrears. 2nd mortgage was in foreclosure. Client was also hoping for some extra funds to inject into business.
Challenge:
- 2nd mortgage being in foreclosure and property tax arrears.
- A stand-alone non flag restaurant with restricted use provides marketability issues.
- Property is completely surrounded by Auto Mechanic shops.
- Restaurants are hard to find financing for due to high failure rate.
- Condition of the property was below average.
- Property under holding company name.
- Expensive commercial appraisal and Phase 1 environmental report required.
- 67% LTV is considered quite high for this type of property.
- Bruised credit with numerous late payments, 1 paid collection and 2 R9’s.
Results:
- Deal was referred to Plan B on October 24th. DLC Agent wanted to remain involved and the point of contact for the client. True team effort between Plan B and DLC agent.
- Deal was shopped to many lenders, all declined due to property type coupled with foreclosure.
- Letter of Interest was obtained on Nov 15th, subject to a commercial report and Phase 1 environmental. Appraisal surprisingly came in a little higher dropping LTV to 61%.
- Approval yielded enough funds to fully pay 1st, 2nd, property tax, and still provide about $70k to inject into business.
- The final consolidation allowed for new cash out for the client AND reduce monthly payments by approx. $700/mnth which improved business cash flow
- DLC agent did a great job handling a clearly distressed client who very nearly lost his restaurant and livelihood.
- Referring DLC agent to receive $7,000.00 commission check and a loyal happy client for life