The State of Real Estate Finance Webinar

Do You Know Where Your Money Is Coming From? Navigating Today’s Lending Market

In this special webinar, we'll cover:

1. What is the New Normal with Interest Rates - Both short term & long term rates
   
   
2. How have investors’ strategies changed in the midst of the new rate environment?
   
   
3. How can investors who find themselves currently overleveraged on properties they intended to flip, but can now only sell at a loss? What options do they have?
   
   
4. How should investors approach new transactions depending on their exit strategy (flip vs fix to rent or long term hold)
   
   
5. Current investor mentality: wait and see vs. find deals now
   
   
6. Changes within lenders: hard money, private, traditional, etc

There is no doubt that the real estate market has been a wild ride since the pandemic changed the normal course of our lives over two years ago. Lending did not escape the effects of Covid-19, and many active investors have learned more about the loan process than even before the pandemic.  

In the spring of 2020, some lenders left active investors in a bind, closing their doors or halting lending while they evaluated the new risks in the marketplace. Over two years later, the market is changing again, and investors need to know how to pivot to keep their pipeline flowing. While everyone is watching rates increase, they are taking their eyes off the real question right now: Can they close this loan?

Realizing a preapproval and rate and term sheet are not set in stone will go a long way in the current lending environment. Lenders are changing underwriting criteria, not making as many or any exceptions to lending guidelines, and lowering loan-to-value midstream in the escrow process. Most investors never thought about the source of their capital before March 2020. The most concerning part of the lending process was getting through underwriting and receiving the message that you were approved and cleared to close. Whatever happened behind the scenes inside the lending machine wasn’t a concern to an active investor. As long as money made it to the closing table, they were happy. This strategy worked until the capital never made it to the closing table. 

When lenders suddenly turned off the spigot to cheap capital, investors scrambled to save deals any way they could. This pushed private lenders with their own capital to lend to the forefront in the hunt for leverage. Active investors scrambled to find funding or negotiate contract extensions to restart the lending process.