Most often than not, lenders are a key factor in closing a multifamily deal. In today’s #Highlights episode, we look back at our conversations with Jacob Cohen of Walker & Dunlop and Rahul Patel of Patel Gaines. The two share tips on how you can find the right lenders for your deal.
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Jacob shares about the different kinds of debt and how it affects your underwriting, how they go about pitching deals to banks and building the right narrative to get the required loan. Meanwhile, Rahul talks about the different types of lenders, what to look for when choosing one and various other key aspects related to picking a lender. Click the play button now and learn how to find the right lender for your multifamily property!
Key Points From This Episode:
- Walker & Dunlop’s objective of finding the best capital for your deal.
- When people should seek help in the process of buying a multifamily property.
- The loan as a critical piece of buying a multifamily property and using a mortgage broker.
- How the different types of debt affect your underwriting and the role of interest-only (IO).
- Their approach to pitching a deal to banks and getting the loan that is required.
- The process of building the story to get the loan and finding the right lender.
- Most deals have strong debt components, so picking the appropriate lender is crucial.
- The three big steps to take when looking for a lender.
- Four of the main spaces people are getting money for multifamily deals from.
- Some details about conventional lending and its benefits.
- Local banks are often overlooked, but they are great places to start for multiple reasons.
“As you’re either starting the business, or you’re already in the business and you want to understand different capital types that you can use for your property, you may want to talk to someone like me, or there are many of us across the country, to understand the capital that’s available today.” – Jacob Cohen
“Separately, besides for Fannie and Freddie, there are many other lenders out there. There’s life companies, there are banks, and we want to understand are you syndicator? Are you investing your own family capital? Are you willing to sign recourse? How long of a term do you want?” – Jacob Cohen
“If you’re risk-averse and you’re worried about the market – where rates are and where rates may be in three years, you may want to really push for 10, or even 12-year loan to try to keep – rates today are phenomenal, so you want to lock it in and get long-term debt, even though maybe you’re going to lose out in five years of doing another cash out refinance, but you’d rather have long-term conservative debt.” – Jacob Cohen
“You’ve got your lender, right? You got somebody who’s lending you the rest of the money, and they’re not in it for the ride with you. They’re in it for loaning you money to get a guaranteed return on an interest rate for them, and they have an asset that is there, their collateral to some extent. So they’re not all the same.” – Rahul Patel
“My advice typically to many of the folks that are listening to this, start with your local banks if you can. If they’re within your threshold, start there.” – Rahul Patel
“So I would say go with your feeling. Get some experience. If you don’t feel comfortable there, then really get enough homework on them and find out and see what people are saying about them as a lender.” – Rahul Patel
Links Mentioned in Today’s Episode:
About Jacob Cohen
Jacob Cohen received his MBA in finance from Bar-Ilan University and his bachelor’s degree in liberal arts from Excelsior College. He is responsible for providing financing solutions to commercial real estate developers and owners throughout the United States. Over the course of his career, Mr. Cohen has been involved with underwriting and placing over $2 billion in transaction volume.
About Rahul Patel
As Managing Partner of the fifth fastest growing law firm in the nation, Patel Gaines, Rahul B. Patel has a flair for delivering simplicity and superior client service. Over the last decade, he has developed a reputation for his innovative approach to commercial real estate and property tax litigation, where he currently represents over $8.5 billion in commercial property. Not only does Rahul lead the Patel Gaines team, but he is also a certified NBA Agent, a guest speaker for multiple organizations, and Professor of Hospitality Law at the University of Houston. Rahul was named the San Antonio Business Journal’s 40 Under 40 Man of the Year as well as a Top 100 Influencer in Law nationally. He has also been featured in USA Today, Forbes, Fortune, BusinessWeek, Texas Lawyer and many more. Patel Gaines has received numerous accolades, including being named a Best Place to Work by the San Antonio Business Journal on multiple occasions.
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