About this Transaction
We recently closed two multifamily loan transactions involving an “equity swap” between two business partners. Not only did we find a lender who was able to complete this transaction, we were also able to provide cash out to each of them at the close. Most often when we are approached with scenarios such as this it is a single building owned by multiple parties where one party is looking to buyout the other. However on this deal both partners had 50% ownership in each building and were looking to buy each other out so that they each owned one individually. This transaction was very unique and required a lot of research and negotiation up front with the lender to determine how to structure the debt. We were able to arrange a hybrid/fixed loan with the following program highlights:
- 70% loan to value, “purchase” and cash out
- 5 year fixed mid-3%
- Flexible step-down prepay with the ability to pay down the principle balance by 20% per year without a penalty
The process took about 60 days to complete. We worked very closely with escrow and title to assure the transfer went through without a hitch. Both of our customers were extremely satisfied with these loans and their structure and our ability to perform.