- Attractive low-cost financing.
- No minimum or maximum loan size.
- Maximum interest rate is set at rate lock.
- Optional extension to second 5-year term with minimal re-underwriting.
- Convertible to a fixed-rate loan with minimal re-underwriting.
- Existing, stabilized multifamily properties, including Conventional, Multifamily Affordable Housing, Seniors Housing, Student Housing and Manufactured Housing Communities.
- Loans for acquisition or refinance.
Initial 5-year loan term. Optional extension to a second 5-year term at maturity. The rollover will retain the same Guaranty and Servicing fees as the original loan. Rollover will not incur a prepayment premium.
Up to 30 years.
INTEREST RATE ADJUSTMENTS
Adjusts based on changes to the underlying Index and is equal to the Index plus the Margin.
- 1.00x at the maximum lifetime interest rate;
- Mortgage loan amount shall not exceed that of a fixed-rate loan with similar terms.
30-day Average SOFR.
Supplemental loans are available.
No prepayment is allowed during the first year of either the initial or second 5-year variable rate terms. Thereafter, prepayment is permitted with the payment of a 1% prepayment premium. No prepayment premium is due during the “open period” (typically the last 3 months) of either the initial or second 5-year variable rate loan terms.
INTEREST RATE CAP
Maximum monthly interest rate adjustment of 1% up or down. Maximum lifetime interest rate to Borrower capped at 5%, plus the guaranty fee, plus the servicing fee.
INTEREST RATE FLOOR
The interest rate will never be less than the sum of the investor spread, the guaranty fee and the servicing fee.
CONVERSION TO FIXED RATE
Subject to the terms of the Loan Document, the variable rate Mortgage Loan may be converted to a fixed rate Mortgage Loan (with a 7- or 10-year term) on any rate change date beginning on the first day after the Lockout Period and ending on the first day of the third month prior to the Maturity Date.
- No Prepayment Penalty is charged at the time that the variable rate Mortgage Loan converts to a fixed rate Mortgage Loan.
- Minimal re-underwriting; Lender determines that the current Net Cash Flow can support the new fixed- rate terms.
- No increase in the loan amount; loan may be eligible for a Supplemental Loan.
Non-recourse execution with standard carve-outs for “bad acts” such as fraud and bankruptcy.
Replacement reserve, tax and insurance escrows are typically required.
Standard third-party reports required, including Appraisal, Phase I Environmental Site Assessment and Property Condition Assessment.
Loans are typically assumable, subject to review and approval of the new Borrower’s financial capacity and experience.
This sheet sets out the general guidelines of a loan program and is designed solely as an aid to prospective borrowers and other clients. It does not represent or imply a contract or a commitment to lend funds. A commitment to lend funds may only be made by a written letter issued by NewPoint to a prospective borrower. This term sheet is subject to change at any time without notice at the sole discretion of NewPoint Real Estate Capital LLC.