ALB was called upon by one of their VIP customers who was seeking to refinance an apartment building that was recently purchased. The goal was to cash out and have the new loan be based off a new appraised value which was to be supported by capital improvements and increased rental revenue.
Since the property had been purchased just over a year ago, many lenders had seasoning requirements. Additionally, we needed the lender to give credit for capital improvements and give credit for the new higher rents as well as the implemented parking fee income. Lastly, and very important to the transaction was to find a way to eliminate the existing prepay penalty.
ALB structured a new loan with the existing lender had them agree to waive the prepay and they also agreed to give credit for all of the cap ex. Fortunately, the appraiser came in at the value that we needed. We were able to lower our client's rate and obtain 5 years of interest only, while obtaining a significant amount of money as cashout. We closed and are already working on a purchase loan for the borrowers.