You put more into the building than the appraisal shows. Where bank-style programs stop at 70%, this loan goes to 75% on a refinance, and that gap is often the difference between closing and bringing a check.
A low appraisal hits hardest on a refinance. You bought, renovated, and leased up, and now the appraiser says the building is worth less than you've got in it. At 70% of a light value, the new loan can come in short of your bridge payoff, and the difference comes out of your pocket.
Two things close that gap. Going to 75% instead of 70% adds five points of value to the loan. And qualifying on the interest-only payment makes sure the building's income can actually support that higher loan. On most low-appraisal refinances, one of those two is the limit. This loan handles both.
On apartment refinances where the appraisal came in below expectations, loan amounts typically range from $500,000 to $20 million and above. Maximum LTV is typically 75% on a refinance.
These are typical ranges, not a quote. Your rate and loan amount depend on the property, your credit, and the market.
These are typical terms. Yours depend on the building, the market, occupancy, and the term you choose.
You spent on units, roofs, and systems that the comps don't reflect.
Small markets and unique buildings where the appraiser had little to work with.
Cap rates moved and the value moved with them.
The payoff is set, and the value came in under it.
You paid up for the location or the upside.
Five more points is what you need.
The building: 40 units, bought and renovated for about $5.3 million all in, with about $345,000 of net operating income. The owner expected $5.8 million. It appraised at $5.2 million.
The problem: A $3.9 million bridge payoff. At 70% of $5.2 million, a bank-style loan came to about $3.64 million, leaving the owner to bring roughly $260,000 plus closing costs.
The loan: 75% of value, about $3.9 million, with the income checked on the interest-only payment.
The result: The bridge paid off in full. The owner covered closing costs only.
Illustrative figures, rounded. Your terms depend on the building, the market, and the loan.
For owners who did the work and got a number they didn't expect.
Five more points of leverage can close the gap.
Every point of LTV is money you keep.
The interest-only payment lets the income support the full 75%.
Lock long-term debt now and let the value rise later.
What you own, what's owed on it, and what you want the loan to do. A rent roll and T-12 are all it takes to start.
The loan amount, the structure, and the cash to or from you at closing, before you pay for an appraisal.
Appraisal, environmental, title, and insurance get ordered and kept on schedule. You always know what's left before closing.
Loan documents signed, the old loan paid off, and the rest wired to you.
Send the appraisal, rent roll, and your payoff amount, and we'll come back with terms.
