Commercial Loan Modification Solutions

Commercial Loan Modification Solutions

Modification of a commercial loan is just one of several possible outcomes a business owner should consider when facing the possibility of a commercial foreclosure.:

Term Extension - This is when the bank agrees to extend the maturity on a loan that can't be refinanced because of high LTV but has cash flow sufficient to service the debt.  This type of extension can be difficult for a lender to agree to due to its regulatory pressures.  We can often with our analysis tools convince the lender that an extension is in their best interest despite LTV's that are outside of their acceptable range .

Permanent Modification - Often a complex transaction that the bank is reluctant to do as it often reduces the value of the asset on the banks books.

Principal Reduction - These are usually only done in relation to a short sale or short refinance where the bank accepts less than the full value to settle the debt.  The bank won't reduce the principal so the property owner can make a profit.

New Equity Partner - The bank is more likely to work with a borrower that is willing to release equity in the property to a new investor that comes in with cash.