“Banks only\u00a0loan you money if\u00a0you don’t need money”.\u00a0 Ever hear that old axiom?\u00a0\u00a0 That has actually been a truism for lots of years.\u00a0 In this market however, banks not only don’t want to loan you money if you do need it, they aren’t so fussy about loaning it to you even if you don’t need it.<\/p>\n
Actually there is a little bit of a twist to that statement.\u00a0\u00a0 The bigger you are, the tougher it is to get money.\u00a0 That is, if you buy a billion dollar project, or several projects to make up that billion, you probably will have a heck of a time getting the financing to complete the\u00a0purchase.<\/p>\n
Why you ask?\u00a0 Why is because nobody seems to know how to evaluate the safety of a loan.\u00a0 All of a sudden the major lenders in the United States, especially Wall Street, no longer believe that they actually can tell a good loan from a can of beans.\u00a0 This is a strange world we live in when the supposedly best and brightest don’t have any faith in their own reasoning abilities.<\/p>\n
Now the real twist comes.\u00a0 Remember those people who needed a loan but the banks looked down on them?\u00a0\u00a0 Well, suddenly they are the only ones who can get financing.\u00a0 If you need to borrow\u00a0$250 mil.\u00a0for a project on main and main with solid gold tenants you can’t.\u00a0 However, if you need to borrow $2.5million for a nice little shopping center in some suburban setting loaded with mom an pop tenants, you can.<\/p>\n
Strange as it may seem, the smaller investor, the guy next door, can actually buy real estate more readily than that major institutional investor.\u00a0 The catch is, and there is usually a catch, this borrower, who is now the apple of many a banks eye, is very often afraid to buy because it may be the wrong time in the market.\u00a0 If this investor does not wake up he may miss some pretty terrific interest rates on loans that will ensure cash flow for many a year to come.\u00a0<\/p>\n
Local bankers are waiting with outstretched arms for the missing investor.<\/p>\n
\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"
“Banks only\u00a0loan you money if\u00a0you don’t need money”.\u00a0 Ever hear that old axiom?\u00a0\u00a0 That has actually been a truism for lots of years.\u00a0 In this market however, banks not only don’t want to loan you money if you do need it, they aren’t so fussy about loaning it to you even if you don’t need […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[18,25,34,92,103,140,179],"class_list":["post-25","post","type-post","status-publish","format-standard","hentry","category-market-timing","tag-add-new-tag","tag-borrowing-on-real-estate","tag-buying-real-estate","tag-investors","tag-local-bankers","tag-real-estate-financing","tag-terrific-interest-rates"],"_links":{"self":[{"href":"https:\/\/www.swartzcre.com\/observations\/wp-json\/wp\/v2\/posts\/25","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.swartzcre.com\/observations\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.swartzcre.com\/observations\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.swartzcre.com\/observations\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.swartzcre.com\/observations\/wp-json\/wp\/v2\/comments?post=25"}],"version-history":[{"count":0,"href":"https:\/\/www.swartzcre.com\/observations\/wp-json\/wp\/v2\/posts\/25\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.swartzcre.com\/observations\/wp-json\/wp\/v2\/media?parent=25"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.swartzcre.com\/observations\/wp-json\/wp\/v2\/categories?post=25"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.swartzcre.com\/observations\/wp-json\/wp\/v2\/tags?post=25"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}