What are Commercial Alt-A Loans?

You may have heard of Alternative Lending loans or Commercial Alt-A loans and wondered, what are those? Alt-A loans are loans that just miss the bank type of financing but are too good to be thrown into private money. It is a fast growing and rapidly expanding part of the commercial mortgage marketplace.  It seems there are new sources coming to market every few months. We intimately understand these loans and have become adept at closing them.

Last week we closed one for a client who could not get bank financing because of felonies that showed up even though he had great credit. Bank after bank denied him before he came to us. We got it closed last Friday on an Alt-A loan. HERE ARE SOME OF THE USES OF THIS TYPE OF LOAN:

– Loans with NO TAX RETURNS

– Investment Property below occupancy requirements for conventional financing.

– Loans to borrowers with credit down to a 550 score

– Loans to borrowers with BK or foreclosures after just 2 years (most banks want at least 4)

– Financing for Foreign Nationals

– Small loan sizes (apartment loans as small as $250,000 for example, tough to find financing for)

– And much more…..

With 5 year fixed rates typically around 7-8%, with longer 30 year amortizations, the pricing is not that bad. Most SBA loans of prime+2.75% are now at 8.25% and that is adjustable, these are fixed rates! A 5-year fixed at 7.5% on a 30 year amortization is equivalent in payment to a 20 year bank loan of 5.7%! So the pricing really is not prohibitive, especially for the fact that the buyers will NOT QUALIFY for bank financing. It really is a good loan product.  CLOSINGS TYPICALLY TAKE ONLY 35 to 45 DAYS! So it is quicker too.

At Commercial Capital, we have our own private money, and we underwrite for tons of quality low interest rate sources from conduit to agency to SBA and conventional.  We also have a full line of alternative lending loans that can work for both owner occupied businesses and investor properties. If you want a loan closed, we are the ONE STOP SHOP.