The excerpt below pretty much sums up where we have been interest rate wise for the past few months. The mortgage market has remained in a narrow range for the past several months. We feel the interest rate complex is currently in a holding pattern until there is evidence of inflation getting closer to the 2% Fed target rate or unemployment rises to a level of creating concern for the Federal Reserve. Neither one of these is occurring at this moment, but we are one or two CPI and employment reports away from a potential breakthrough in rates trending down. One of the wild cards in all the above is how tariffs are going to impact inflation. Remains to be seen. Some pundits argue that the tariffs are inflationary, while others take a 180-degree vision that the tariffs will have a minimal impact on prices. This is one of, if not the biggest, points the Fed is waiting for clarity on.
As far as the mortgage market is concerned, rates have remained steady in the mid to high six percent range. As a reminder we offer a full spectrum of residential loan products that do not require any type of tax returns. These loans are based on bank statements and/or rental income on the property. Perfect product for the self-employed with major write offs so the AGI is minimized on tax returns.
Many multifamily and commercial loans are maturing which requires cash for the payoff or refinancing. Some of these existing loans will roll rather than being due, but the new rate based on the original loan paperwork is always almost higher than we can offer with a new refinance loan. Also, cash out is available.
A few notable recently closed loans
- $13M sale in Bel Air-70% loan – we established a banking relationship with one of our lenders that made the loan terms possible with borrower retaining his two other homes
- $4.25M Sale in Los Feliz 80% loan, challenging underwriting utilizing existing income, but allowing income from a new contract to the buyer’s corporation vs. individually from a major studio
- $2.5M cash out refinance- 18-unit apartment loan in Silver Lake. We worked with the borrower to buy out partners as part of a nine-property dissolution—This required extensive involvement by us with the partners, title and escrow.
- 95% Loan – $1,209,750. The client is a professional who just graduated, and this was the first documented W2 position. This was an ideal program due to the limited down payment, but ability to handle the debt service. We helped orchestrate a gift on paper from the parents to show reserves.
- Owner User commercial store front purchase -$1.8m sale with 80% loan. The buyer already owned another property in the immediate neighborhood.
As always, we look forward to answering your questions about potential financing and going over what -if scenarios.
Best regards,
Gloria Shulman, Curtis Cohen, Ted Kachadorian & All of us from Centek
Centek Capital Group | gloria@centek.com | centek.com
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