Birmingham, MI (PressExposure) January 14, 2011 -- Commercial Finance Advisors, Inc announces the recent closing of a physician loan in Indianapolis, Indiana. This was a medical office property, with a purchase transaction at $1,550,000. The building itself is two stories, 45,000 square foot, Class A office building and built in 2003. The financing proved was at 90% loan to value with a 5 year fixed rate, with no balloon. Total time from application to funding was 44 days.
"We do a lot of work with physicians, throughout the nation. They are our favorite clients. We are normally able to offer them more than other borrowers, such as greater underwriting flexibility, higher loan to values, etc and this transaction was no exception to this. Had this borrower been anything other than a doctor, this transaction would have been declined. For one, our client was very pushed for time. We received the application on the 22nd of November and had to close it before the end of the year. There were other complications as well, such as his 2008 financials did not cash flow and his 2009 number were at the bare minimums. However he had had a strong 2010 and that is what most of the underwriting went off of. With any other business type, this alone would have killed the transaction." Comments Jeff Rauth, the originator on the loan.
"There were other complications with the transaction such as a deed restriction, that was discovered 5 days before the scheduled close. Everyone step up from underwriting, title, CDC, appraisal, environmental, the SBA itself on their approval, etc and got their respective assignment done on time and on schedule. And the transaction closed right between the holidays on the 30th of December. But the thing I am most proud of, was that the doctor had taken the loan to 3 other major, national banks, they all dragged out their declines and wasted his time. We were able to get right on top of the transaction and got it done."
The loan program that was used was an SBA 504 loan, which is by far the best type of financing currently in the market for physicians that want to purchase commercial real estate for their practice. There are a couple of reasons for this. Low, long term fixed rates and 90% financing are the most important. Also, the loan program, unlike commercial mortgage loans are still reliably closing, and again at 90% financing. Over the last few years, it cannot be overstated how important this is as so many banks have completely stopped looking at commercial financing, even for physicians.