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RMC fields a lot of callers who are wondering about the difference between a commercial
mortgage bankers and commercial mortgage brokers and how they may best
proceed with a project funding. Put simply, all commercial mortgage
bankers are brokers, but most commercial mortgage brokers are not mortgage
bankers. Bankers are licensed, typically underwrite their own paper and
then re-sell the paper at a later date. This is sometimes referred to as
"table-top closing". The banker funds the deal, then turns
around and sells it to another party for a profit. Fascinating stuff, but
let's focus on you and what your needs are going to be for your commercial real
estate development project financing - construction and permanent lending.
The biggest issues we face with clients seeking financing really boils
down to having to take remedial measures because the client jumped the gun,
retained a broker and then everything grinds to a halt and people are left
wondering what is going on.
Before you start emailing your application package around the Net, it
would probably be a good idea to do a reality check and see if you are ready for
a loan submission. Hereinbelow is a quick checklist of items that are
commonly required (you may wish to bookmark this page for future reference):
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Site
Control. You MUST have an executed purchase agreement, option
agreement, letter of intent or already have fee-simple ownership of the
project site to qualify for underwriting consideration. If you don't
have control of the site, you are going nowhere.
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Environmental
Phase I. Dated within the last six months, please.
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Market
Feasibility Study. Also dated within the last six months.
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Pro Forma
Financial Presentation. Created based upon the findings of the market
feasibility study.
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Capital
Funding Plan Proposal. This is your "executive summary" of
the transaction. No more than 30 pages, but incorporates all the key
items.
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Site
Plan. You need the approved development plat. Lenders will not
lend money for zoning battles.
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Business
Plan of Department Operations.
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Executed
Property Management Contract.
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Executed
Construction Contract.
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Executed
Development Management Agreement.
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Schematic
Phase Outline Construction Specifications.
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Specimen
Title Insurance Report.
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Evidence of
Zoning & Construction Permits.
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Borrower
Financial Statements (last three (3) years is the standard).
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Borrower
Tax Returns (last three (3) years).
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Utility
Capacity/Will-Serve Letters - from each utility provider.
All of these
exhibits need to be in electronic format for ease of access and
transmission. The most common way these documents are warehoused is to
place them in a secure directory on your corporate web server.
If you have
questions regarding your application then it is time to call Rainmaker Marketing
Corporation.
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