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Numerous funds are sitting on pools available for deployment at terms and yields regulated to Hard Money lenders. To broaden their marketing net, originators have softened their rates and fees for higher quality assets. Assets not quite ready for institutional funding, yet are “near bank” quality, qualify for “Soft Money” terms. Rates range from 7% to 9% with fees capped at 2 points. Funding is nationwide and typically on a non-recourse basis with LTVs as high as 70%. Debt Coverage should be at least break-even at close or have executed pre-leasing in place to mitigate cash flow shortage. Loans to $10,000,000 typically fund in 30 to 45 days.
