Mezzanine Financing- Mezzanine Loans - Mezzanine Funding

Mezzanine Financing- A mezzanine loan is a loan that is subordinate to a primary lender but it is debt that gives the Client the ability to drive the total financing to a higher leverage level, as compared to conventional financing alone (typical CLTV is 85%; in some cases, up to 95%).

Mezzanine Financing has become a common methodology to secure supplementary financing for real estate acquisitions and development projects. A mezzanine loan can be a freestanding loan that can be used for an existing property/properties or for properties that are under construction and the mezzanine loan can be secured by a second mortgage or a pledge of partnership interests. This is typical in cases where the primary mortgage or construction loan equity requirements are larger than 10%. The mezzanine financing program provides additional funding when the first mortgage is at the maximum loan amount; loan amount can be $1M and larger; however, the preference is $3M to $30M; larger transactions will be considered on a case-by-case basis

Typically, our mezzanine financing lenders will require a pledge of 100% of the partnership interests and a recorded UCC form to secure mezzanine debt. Mezzanine financing is typically structured as recourse, with a fixed preferred pay rate, and for a loan term that can run up to 5 years. Acknowledgement of the mezzanine lender position from the first mortgage lender is desired, but not always required, dependent upon property location and specific underwriting circumstances. Our mezzanine financing lenders will examine the Client exit strategy to assure that the Client can finance or sell the property in time to retire the debt by the maturity date.

Our mezzanine financing lenders will consider most property types and target stabilized properties. They will consider transactions in which the Client seeks to pull equity out of a property encumbered by first-lien financing that precludes additional financing to a higher loan amount. An example of this kind of real estate transaction would be a commercial property that has appreciated over several years. It is now in position to support additional loan dollars, but it has been encumbered by senior debt financing that is either closed to prepayment or has an economically prohibitive prepayment penalty or yield maintenance provision.

Mezzanine Financing Interest- A mezzanine loan rate will vary widely depending on the leverage level of the Client, the degree of risk assessment, the actual property type, and the specific location. The interest on mezzanine financing loans is higher than senior debt or debt of higher priority, thus making the compound interest a substantial part of the repayable principle

Need $1M or larger in mezzanine financing? Contact us now for your mezzanine financing needs.

IMPORTANT: If you are serious about securing funding, please go to the Contact Us page and read the procedures first. Then, please email or fax us a 1 to 5 page Executive Overview. Thank you. We look forward to earning your business.

Also, Brokers/Consultants are welcomed, appreciated, and protected!

Commercial Funding International, LLC
Mr. Jerry O'Neill, Managing Director

“Service to help you capitalize your opportunities."

tel: (503) 245-2789
fax: (503) 213-7875

email: info@commercialfundinginternational.com

Commercial Funding International and CFI are a Trademarks of Commercial Funding International, LLC.