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Posted by Drew on December 10, 2005, 1:44 pm
Please log in for more thread options Thanks again.
While doing more searching on the Internet, I came across this website which
I thought was interesting:
http://www.c-loans.com
http://www.c-loans.com/feeagree.html
I'm not sure it would be helpful for my friend, but I thought the pitch on
the fee agreement sub-page would be interesting reading to anyone in the
commercial mortgage broker business.
> IF (and that's a guarded "if") this guy is legitimate, then it would be
> worth while to exchange an email on the side and get some phone numbers.
The
> way a broker works is to provide a loan with normal and customary closing
> costs, then collect his commission either from the borrower if the
borrower
> wants the lowest possible rate, or from the bank (investors) if he wants
the
> lowest possible cost, or some combination of the two that meets the
> borrower's expectations.
>
> Let's say that 6.00% was the going rate for a Par Loan. The borrower would
> pay all of the sales commission to arrange this loan. For the sake of
> discussion, let's assume the sales commission is 2 points -- that's high
but
> it gives a place to illustrate the concept, and in some parts of the
country
> this is a reasonable and customary commission, depending upon the loan
> amount.
>
> So, to get a 6.00 loan, the borrower pays 2 points. But if the borrower
> doesn't want to pay that much, then the rate can be jacked to -- for
> example -- 6.25% and the borrower pays 1 point and the investor pays the
> broker 1 point. OR, the borrower can take a loan at 6.50% and have no
points
> and the investor pays the broker 2 points to bring the loan package in.
>
> On a 100,000 loan, 2 points isn't very much money, but on a 1,000,000
loan,
> it's a ton of money. 1 point is 1% of the loan amount, so on 100 grand,
it's
> 1,000, but on 1 million, it's 10,000. The work is arguably about the same,
> and the 100,000 loan is typically more difficult because the borrower
isn't
> as savy. The bottom line is if the loan is very large, the points should
> come down. Points are negotiable.
>
> It would be cool if you guys could get some of the ground work laid here
so
> others could benefit from the discussion. Good luck.
>
>
>
>
> > My relpy referred to my services as a Commercial Loan Broker and will
> > be helpful as an informational service at the very least to those who
> > are not aware of worldwide funding sources for their unique situations.
> >
> > I do not provide access to lending sources for an upfront fee. I
> > provide a loan and the charges for the loan are associated with the
> > actual loan.
> >
>
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