commercial loan modification
Commercial property values in most states have declined substantially over the last several years and, as a result, the owners of many of those properties find themselves in danger of defaulting on their mortgages and losing their properties through bankruptcy or foreclosure proceedings. Fortunately, it may be possible for property owners to negotiate loan modifications with their lenders in order to reduce the outstanding amount owed and even lengthen the term of the loan to minimize payments.
What is a commercial mortgage loan modification?
Commercial Loan Modification is when a business or individual that owns a commercial property such as a strip-mall, shopping center, apartment building, agree with the mortgage holder to permanently change the terms of the original note.
These loans are often known as portfolio loans since they are often not securitized like Fannie Mae or other single family residential loans. Since the investor of the loan is often easier to identify and approach, the attorney hired by the property owner is much more effective in negotiating a solution that benefits both parties.
Why would the banks want to renegotiate?
The banks would rather change the terms of the loan to a payment that you can afford than take the property through foreclosure. This will allow them to keep the loan on their books at full value rather than being forced to mark it down according to current mark-to-market accounting rules.
Do I qualify for a loan modification?
There are many factors that determine on what basis a lender will modify a loan. Equity, income, payment history, debt ratio. An experienced loss mitigation consultant can guide you as to the best approach to take. Every case is different. If you the property is producing income that you can prove then you probably will be able to come to a resolution.
Can I do it myself?
You can negotiate on your own but you are more likely to get a better deal if you have a professional negotiator on your side. The bank is unlikely to offer you the best possible deal. Professional loss mitigators have existing relationships with most lenders and know how to get to the decision makers.
Don’t do it alone, call Allstate Business Consultants… (954) 587-4366
