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| KEY RATE INDICES |
FANNIE MAE RATES * |
| Prime Rate |
6.75% |
| 11th District |
4.745% |
| 3 Mo. T’s (YTM) |
3.52%
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| 6 Mo. T’s (YTM) |
3.51% |
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| 5 Yr. U.S. T’s |
4.65% |
| 10 Yr. US T’s |
5.12% |
| 30 Yr. US T’s |
5.54% |
| 12-MAT |
5.102% |
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| LIBOR - 1 mo. |
3.80% |
| LIBOR - 3 mo. |
3.71% |
| LIBOR - 6 mo. |
3.73% |
| LIBOR - 1 yr. |
3.89% |
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| Tier 2+ (80% LTV) |
6.95% |
| Tier 3+ (65% LTV) |
6.77% |
| Tier 4+ (55% LTV) |
6.57% |
| 10 yr. term/30 yr. amort. |
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| TRANSACTION OF THE WEEK! |
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$1,500,000 (Start Rate: 4.80%!) Jumbo Home Loan for Calabasas Area Estate Home: This 6,000 s.f. ranch style home was built in the late 1950's, and extensively remodeled in the mid 1990's. The 6 bedroom, 5 bathroom house features a tennis court, 2 fireplaces, spa, etc. GSP arranged 61% LTV financing (borrower did not want "max dollars") with a regional portfolio lender. GSP has approximately $25,000,000 of loans in process under this cutting edge program. Terms: (1) Rate: 30 day LIBOR + 1.05%; (2) Other terms: see "Hot Money" below. Note: All processing costs (appraisal, title, reviews, legal, escrow, etc.) = app. 35 basis points on the transaction. (George Smith)
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| HOT MONEY ! |
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4.85% (as of 7/20/2001) Adjustable Rate Jumbo Home Loans: Why So Low? (1) Lender is seeking new banking clients. (2) Loan requires setting up a bank account to make monthly mortgage debit payments. (3) Lender knows it has to win your other business, i.e. the range of private banking services they provide. (4) There are no other strings. Program Highlights: Rate: "30 Day LIBOR + 105"; Amount: to $2,500,000; Term: 30 years; Payment Schedule: Interest only yrs 0-10; Lender Fee: 1%; Prepayment: 1% for years 0-4, no prepay thereafter; Geography: National; Borrower Credit: 700 FICO score; LIBOR History: 30-day LIBOR has averaged 5.64% since January 1996 (64 months). This loan would have averaged 6.54%. For this loan to go to 7%, 30-day LIBOR would have to increase by 2% to 6.1%.
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Purchase |
Refinance |
Cash Out |
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| Amount |
LTV |
LTV |
LTV |
Liquidity |
| To $1,100,000 |
80% |
75% |
70% |
12 months |
| $1,500,000 |
75% |
70% |
70% |
18 months |
| $2,000,000 |
70% |
65% |
65% |
24 months |
| $2,500,000 |
60% |
60% |
60% |
30 months |
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| $1,650,000 Floating Rate Perm (104% of Borrower Equity!) for 14-Unit Apartment Complex in Venice Beach: Our borrower purchased the property over a year ago and gut-rehabbed it down to the studs. He then fully leased it at market rents. GSP arranged take-out funding with a regional bank that allowed the borrower to pay off the existing loan, reimburse all rehab costs and recapture 104% of his original equity. Terms: (1) Rate: 6 month LIBOR + 2.15%; (2) Term/Amort: 7/30; (3) DCR: 1.35; (4) LTV: 71%; (5) Lender Fee: 0.375%; (6) Recourse. (Andrew Levant) |
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| Private Mezzanine Fund With Quick Close Capability: GSP has arranged a strategic alliance with a high net worth individual to provide mezzanine financing. The investor is targeting returns in the "high teens/low twenties." Lender will review existing 3rd parties and can close within 1 week of submission. Program Highlights: (1) Loan Amounts: $500,000 - $2,000,000; (2) Preferred Product Types: Retail (preferably market/drug anchored), single tenant office or single tenant industrial; (3) Loan Term: 18-24 months; (4) Leverage: up to 85% LTV; (5) Geography: Northern/Southern California preferred, will consider other Western States. (6) Will Not Do: Land, Hotels or Multi-tenant office. Please direct inquiries to Gary E. Mozer at gmozer@gspartners.com or ext. 110. |
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| INTEREST RATE/CMBS UPDATE |
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The bond market ignored the higher than expected CPI numbers and focused instead on Greenspan's congressional testimony. He indicated that the Fed is prepared to cut rates further and feels inflation is in check. The 10 year Treasury rallied to as low as 5.08%, closing at 5.12%. The market was also affected by lukewarm industrial numbers. Also, Argentina seemed to resolve its debt crisis. CMBS: The first half of the year saw a much higher than expected volume: $32.5 billion in US conduit, over $40 billion worldwide. Now, the market is bracing for a massive late July/early August glut of issuance. Over $8 billion is expected to price in the next couple of weeks, including: (1) $1.4 billion "meat and potatoes" conduit from 2 major originators; (2) Another "top drawer" offering featuring low subordination levels from 5 lower leverage originators; (3) Another $1.0 billion standard conduit transaction (2 originators) and some floating rate, single transaction, and credit tenant pools-Something for everyone! The 10 year AAA's are being shopped at Swaps + 45-48. Secondary trading in recent weeks has been pricing at these levels. Hopefully, the glut will not cause widening spreads. (David R. Pascale, Jr.)
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| * GSP is an L.A. correspondent for ARCS Commercial Mortgage, the nation's largest FNMA/DUS originator. |
| Note: Lender pricing and loan points are subject to change and exclude GSP loan placement fees. |
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