Traditional commercial banks for the most part are not lending money for commercial projects. The available money is from non-depository lenders and financial institutions, hedge funds, off shore investment funds etc. These sources make money lending money not from checking accounts,savings accounts, credit cards etc.
There is great demand for money from these sources and the underwriters are cherry picking the best loans.
These sources require complete,up to date and realistic information. A realistic valuation of assets used for collateral is especially important.
Many appraisals done two or three years ago and updated last year do not reflect true market value to a lender who is looking at the worse case scenario if the loan fails and the property has to be sold as soon as possible.
Leased office,retail and industrial property constantly is depreciating in value because tenants are leaving and there is excess space available. Landlords often have to cut rents to keep existing tenants or lure new tenants.
Another factor is that because income stream is low, there may not be enough money for maintenance and up keep and the building looses value in the eye of an appraiser.
It is important that you do the best you can to keep the information about your property current. If your information is complete and credible, when you apply for a loan, the underwriter will put your loan on the top of the pile and you have a much better chance than the applicant who is trying to sell old information.
Let us know if we can help you.
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