ASSIGNMENT:

A great example of how an investor needs to stick to the plan! This was a refinance of a transaction that we had financed 1 year prior structuring a high leverage bridge loan. At the time they purchased it they only had 25% downpayment and under bank financing the deal at that time was requiring easily 45% downpayment. So, we placed the borrower in a bridge that allowed for the 25% downpayment and the exit strategy communicated to us was the investors were to make property improvements and aggressively increase rents so that when it came time to taking out the bridge loan we would be able to do so. However, because they didn't stick to the plan we found no other option but to structure another bridge loan with the same lender or otherwise they would have to bring cash in to close under bank financing.

CHALLENGE:

The changing market conditions created a hurdle. Interest rates crept up and cap rates were on the rise. We had interference from competition who were just downright not telling the borrowers the truth, so we had to set that situation straight.

SOLUTION:

We were able to negotiate with the current  1st trust deed holder to keep them out of default.  The lender agreed to refinance for an 18 month term and this allowed the borrowers enough time to execute on their original plan or even sell if they decided to.