Commercial Loans

BANKS EXPECT MORE TIGHTENING FOR CRE LOANS

Today’s post is written by Michael Green, Senior Commercial Loan Originator with Counsel Mortgage Group, LLC. Mike writes monthly on the commercial mortgage market. Check back each month to check his commentary. The Federal Reserve’s Senior Loan Officer Opinion Survey on Bank Lending Practices (SLOOS) regularly checks with banks to better understand their lending landscape. The short take for CRE from the most recent survey is that even tighter underwriting standards can be expected in the future. And while easing interest rates are eventually expected to support relatively low demand from borrowers, that is unlikely to happen now until late...

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IF WE CAN’T HIT THE TARGET, MAYBE WE SHOULD CHANGE THE TARGET

Today’s blog is written by Michael Green, Commercial Loan Originator for Counsel Mortgage Group, LLC It’s well-entrenched in market participants’ minds by now that the Federal Reserve’s target rate for inflation is 2%. While that goal is admirable, we are still in a period of “sticky” pricing pressure, making the central bank’s target seemingly difficult to achieve. The most recent CPI report for December included components that showed some sectors of the economy are still facing persistently higher costs. History shows that once entrenched in an economy, inflation tends to be “sticky” indeed. Sector rotation among goods and services, imports...

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CRE Borrowing in 2024

The Federal Reserve stands at a juncture as it deliberates on its interest rate policy for 2024. The Fed faces the delicate task of balancing a seemingly robust economic recovery against inflationary pressures that appear to be subsiding. Interest rates were left unchanged at a range of 5.25% to 5.50% by the Fed at its policy meeting earlier this month. Interpreting Fed comments after the meeting, markets anticipate rates are likely at or near their peak, and could be cut in 2024 if inflation continues to fall towards the Fed’s 2% target. Barring surprises in economic forecasts (which drives Fed...

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COMMERCIAL MORTGAGE REFINANCE

Many commercial mortgages are fixed for 5-7 years, and then become due. These loans may have been originated before or during the pandemic at much lower rates than today. You may find yourself in a position where your Note is coming due. We can help you find refinancing options. We are mortgage brokers and can shop lenders to find the best deal for you in today’s environment. Don’t feel that you are stuck with staying with the same bank at their rates. Contact us and we can help. To see other posts and videos in our series, click here: https://counselmortgagegroup.com/blog/...

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HOW HIGH AND HOW LONG, MR. POWELL?

Today’s post is written by Commercial Loan Originator Mike Green. The FOMC’s pause on interest rate hikes at the September meeting a couple weeks ago wasn’t a surprise. Inflation has continued to subside, labor has cooled, and supply chains continue to improve. In justifying the pause, they cite: Job gains have slowed but remain strong, The unemployment rate has remained low, Inflation remains elevated, The U.S. banking system is sound and resilient, (We could argue that.) Tighter credit conditions are likely to weigh on economic activity. And then, acknowledging the elephant in the room, “The extent of these effects remains...

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COUNSEL MORTGAGE PROVIDES FINANCING FOR CONSTRUCTION OF SHOPPING CENTER

We are excited to help our client finance the construction of a retail center in Avondale. It will be located on the southeast corner of Avondale Boulevard and The Boulevard. It will consist of a Mexican restaurant, Vietnamese sandwich shop, a nail salon, and a health salon. The completion of the project is scheduled for the 1st quarter of 2024. If you are looking for construction financing of commercial or residential projects, give us a call.

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COUNSEL MORTGAGE CAN LEND IN CALIFORNIA

If you are looking for a residential or commercial loan in California, give us a call. We are mortgage brokers and will shop the loan around to find you the best deal. We Work For You, Not The Lender

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CRE FINANCING IS GOING TO GET TOUGH

Today’s post is written by Michael Green, Commercial Loan Originator for Counsel Mortgage Group, LLC CRE FINANCING IS GOING TO GET TIGHT Yes, I know, after 16 months of increasing rates and continuing QT to the tune of about $1 billion/mo., things are already tight. But did you know … Over the next 12 months, the U.S. CRE market will wrestle with the reality that three-quarters of a trillion dollars in loans are scheduled to come due. Within the context of $4.5 trillion that is the U.S. commercial real estate debt market, this juncture could be a turning point that...

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THE SCARIEST TERM IN YOUR NEW COMMERCIAL MORTGAGE

  We’ve written before about lenders raising the bar, or tightening, lending terms and conditions. One of the terms that’s started showing up in the covenants is “full recourse only”. Everything beyond the value of the property is now on the line. This was a somewhat common term in the 70’s and early ‘80s going through and coming out of the stagflation period at the time. But this had largely vanished from CRE loans when markets were relatively stable. (This term has been maintained in SBA loans from at least 2000, re-named as a “personal guarantee”.)   A June brief...

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ARE WE THERE YET?⁠

⁠ This morning’s official pronouncement: First Republic Bank has been seized, and in a deal that has been cooking for the past several weeks, they’ve agreed to sell to JPMorgan.  If you’re counting, this is the 3rd major US financial institution to fail in the last two months. Not a surprise.  As I said, this has been quietly working since Silicon Valley Bank and Signature Bank both fell prey to poor management practices a few weeks ago. Our immediate concern is how this affects our ability to secure CRE financing. These incidents plus the meteoric rise in interest rates have...

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