The collateral used for most commercial mortgages is the real estate itself. However, some lenders will lend using the cash flow of the property as the collateral. These lenders are called mezzanine lenders.
Therefore, Mezzanine loans are similar to 2nd mortgages. One of the major differences is that if the borrower fails to make payments and defaults on the mezzanine loan, the lender can foreclose in a very short time. In fact, they can foreclose in just a matter of days instead of the usual 18 months it takes to foreclose on most mortgages. This is because the stock of a company is considered personal property. Mezzanine lenders will usually not look at loans for less than $1 million, with property values of around $10 million and higher.
All Access Loans is able to help place lenders with mezzanine loans.
No comments:
Post a Comment