- Joined
- Aug 26, 2010
- Messages
- 380
We have a great deal under contract that for the 1st phase is a repositioning of 11 C class units to A- class. The bank asked for an appraisal which came back confirming we're getting assets below market. We gave that to the bank two days ago. Close is Dec 4th. They also know that we have a P&S for the neighbouring property for the 2nd phase of an overall 20 unit development.
We just got the committment letter and the terms are now not as favourable as what the banker gave us verbally. The interest rate on the interest only construction phase is now 1.25 % higher at 5.25% whereas he promised 4 % verbally, there's a 4K application fee, and a 500 $/yr "annual review" fee.
How much can I push back? I kind of expect the bank is going to try and claw out whatever they can since I would pay a commercial mortgage broker 1 % on close, but this seems a bit beyond that.
Are these terms reasonable? Or is it the bank looking at the closing date and saying these guys don't have much choice?
Thanks, all input much appreciated esp from Thomas and any mortgage guys.
Tris
We just got the committment letter and the terms are now not as favourable as what the banker gave us verbally. The interest rate on the interest only construction phase is now 1.25 % higher at 5.25% whereas he promised 4 % verbally, there's a 4K application fee, and a 500 $/yr "annual review" fee.
How much can I push back? I kind of expect the bank is going to try and claw out whatever they can since I would pay a commercial mortgage broker 1 % on close, but this seems a bit beyond that.
Are these terms reasonable? Or is it the bank looking at the closing date and saying these guys don't have much choice?
Thanks, all input much appreciated esp from Thomas and any mortgage guys.
Tris