June Financing Market & Trading Desk Commentary
Before getting to the financing market dynamics, Trillium Capital Resources is pleased to welcome Brent Shryock to the Jacksonville team, who will join Mike Blevins, Senior Vice President. Brent will be Vice President of Business Development and has extensive experience in banking and business development.
Now to the heart of the matter. Recent days have seen the 10 Year Treasury dip down to 2.44% after beginning the month at 2.63%. As of this writing the 10 Year Treasury has increased right back up to 2.61%, exhibiting substantial volatility. However, overall lender spreads have reduced to very reasonable levels. HUD mortgage rates are now in the 110-basis point range over the 10-year, resulting in mortgage rates prior to MIP of 3.70%, and 4.30% inclusive of MIP. The HUD rate reached a low in the 3.60% range in late May when the 10 Year dipped briefly. FNMA maximum leverage financing pricing is presently in the 4.50% range fixed for 10 years.
We met with a conduit (CMBS) lender last week that provides funding for deal sizes down to $1 million. This is a major shift in the typical conduit loan platform in that deal sizes are generally limited to $5 million and up.
Let’s take a look at the best rates and terms we can deliver to you today; total financing fee is 1% inclusive of lender fee.
* 3.70% fixed rate loan for 35 Years prior to .60% MIP (Source is Red Mortgage Capital)
* 4.25% fixed rate HUD construction loan 221-D4 (Source is Red Mortgage Capital)
* 4.35% to 4.50% fixed rate loan for 10 Years (Source is life insurance company and agency funding with LTV up to 75% to 80% for apartment, 75% for retail)
* 3.85% fixed for 5 years utilizing interest rate swaps with bank (30 Day Libor + 225 bp)
Other Notable Financial Instruments
* Libor rate 1% strike price (Libor Cap) fee is .35% and .45% for 1 and 2 years respectively, which is the same as last month.
* 1 Year Forward Rate Premium is 29 basis points for 10 Year Forward Commitment, down 1 basis point from last month.
Trillium Capital Resources is an approved alliance partner with direct lenders, facilitating timely and competitive loan execution. We will not be OUTBID or OUT SERVICED on any financing deal and will always be competitive with ANY lender, Direct or Indirect.
CALL OR EMAIL US TODAY FOR A FINANCING QUOTE!!!
Our Network of alliance partners specialize in the following product types:
Apartments – HUD, FNMA, Freddie Mac, Life Companies & Conduit Market. LTV ratio up to 80% except for Life Companies, which is up to 75%.
Retail – Life Companies, Conduit & Private Placement Capital. Up to 95% LTV for single credit tenant and up to 75% LTV for all other lenders.
Hospitality – Life Companies & Conduit up to 65% LTV
Self-Storage – Life Companies & Conduit up to 75% LTV
Office – Life Companies & Conduit up to 75% LTV
Deal sizes range from $1 million and up for most product types.