Cash Out Bridge Loans
It is very rare that banks and other institutional lenders are willing to allow borrowers to increase their loan amount (or take out a new loan from the property’s equity) on commercial property unless all of the new funds will be used to improve that particular property. While banks are wary of the increased risk of this type of bridge loan, often called a cash-out loan, Montegra believes that borrowers should be trusted to decide how and where funds obtained from the equity in their commercial properties are spent.
Montegra is an asset-based, private capital bridge lender with a 44-year history of funding first-mortgage, secured loans on commercial and investment-purpose residential property located in Colorado (especially the Denver metro area). Montegra funds loans from $250,000 to $4,000,000 for short-term (one- to three-year) time periods with interest-only payments typically for up to 65% of a property’s appraised value.
The cash-out bridge loans can be beneficial for borrowers who currently have a loan with an institutional lender at a very low loan-to-value (LTV) rate that they want to cash out. Montegra can offer them an increase of the loan principle to 65% of the current property value, and the borrower can then use the additional cash from the new bridge loan for other investment purposes. Montegra can also fund loans secured by properties that have already been paid off, allowing borrowers to take out a loan for up to 65% of that property’s value and put those funds towards the purchase of additional properties or improvements to other properties. As a private capital bridge lender, Montegra is dedicated to working with our borrowers to fund the loan that best meets their investment needs.
Unlike traditional lenders, Montegra is willing to allow second-position liens behind our first-position mortgages. While we do require that our loan always remains in the first position, we are open to discussing potential secondary financing allowances for our borrowers.
Montegra is a direct lender, not a loan broker. When borrowers meet with a Montegra representative, they are meeting directly with the decision-maker who has full authority to decide whether or not to fund a loan. As an asset-based lender, Montegra relies primarily on the value of your property as opposed to the more diverse focus that institutional lenders have, with their strong emphasis on a borrower’s cash flow and their “global financial picture.” In contrast, our underwriting process is simple and straightforward.
- Loan Amounts: $250,000 to $4,000,000
- Interest Rate: 10% to 11% on improved, income- producing property (land rates slightly higher)
- Payments: Interest only with no amortization
- Loan Term: 1 to 3 years with renewal options possible.
- Loan Fees: 2% to 4%.
- Loan to Value: Up to 65% on improved, income-producing properties (up to 60% on land)
- Second-Position Liens: Allowed
- Cash out Restrictions: None
- Closing Time Frame: 30 days or less (from signing of Commitment Letter)
If we can be of help with your cash out requirements please contact Bob Amter or Kim Skari at (303) 377-4181 or email firstname.lastname@example.org.