The Pros and Cons of CMBS Loans: A Guide

The Pros and Cons of CMBS Loans: A Guide

While CMBS loans all but disappeared after the 2008 market crash, in the last 4-5 years, the CMBS market has been stronger than ever, with nearly $88 billion of loans issued in 2017, and October 2018 numbers showing a loan volume of nearly $65 billion from the beginning of that year. CMBS came roaring back for a variety of reasons, including the fact that they often provide the highest leverage loan a borrower can get for properties in secondary and tertiary markets. However, CMBS loans aren’t ideal for everyone— as they can provide a particularly poor loan servicing experience rife with significant prepayment penalties.

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CMBS Lenders vs. Life Companies: What You Need to Know

CMBS Lenders vs. Life Companies: What You Need to Know

CMBS lenders and life companies often compete in the same space for large real estate deals. Both have significant advantages and certain disadvantages. For instance, life company loans typically offer lower rates and significantly better loan servicing, while CMBS loans are much easier to get approved for and offer benefits including interest-only periods (and even full, interest-only loans).

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