Good for my mother: FHA Chief Brian Montgomery on reverse mortgages (Part II) – NMP Skip to main content

Good for my mother: FHA Chief Brian Montgomery on reverse mortgages (Part II)

National Mortgage Professional
Mar 11, 2008

The ideal commercial loan package for your lenderWilliam Pape, CMCverbal and written communication, person-to-person interaction, clients After being in sales work for over 30 years, I can assure you that it is very difficult to make a sale if you cannot meet with the client. In the case of the commercial loan, you actually have two clients—your borrower and the lender. That person-to-person interaction is often critical to making the sale. Even with most of us ordering products over the Internet, I believe that the vast majority of us have concerns about purchasing a complicated, high ticket item in that manner. You just feel better if you can reach out and touch someone—or more specifically, the person presenting a specific product to you. Bear in mind that if you are just taking and placing an order, you are really not involved in the sales process. Even though you may have had verbal and written communication with your lender, it is not the same thing as personal contact. Every day, commercial Mortgage Brokers sell their products/lending opportunities to potential lenders and often never meet them in person. However, your loan package is representing you in the sales process. The question is: Does it represent you well? It is critical that your loan package be professionally designed and presented so that your lending opportunity is well received by the lender. We are all trying to do the best job we can with the least amount of stress, and your lender is not an exception. When the lender picks up your package to review it, you want to make his job as stress-free as possible. You want to make the lender happy that he has taken the time to look at your deal. Let's consider the following suggestions for your loan package: •Package the information in a binder of some type. I use a three-ring binder because the lender can remove parts of the package or add information or notes to the appropriate section of the package. It just keeps everything in order. You may put a personal letter in the outside transparent cover of the binder or an eight-inch by 10-inch picture of the property. •Divide the binder into logical sections with dividing tabs separating the sections. If the lender wants to review specific information or has asked you for additional information pertaining to a specific portion of the package, it can be inserted as desired. The binder may be two- to six-inches thick or you may use multiple binders depending upon your needs. •The three-ring binder may be divided into the following: A. Executive loan summary, which would generally include a three- to six-page summary of the transaction and your loan request, which will allow the lender to get an overview of the transaction. B. Information about the property: 1. Available Member Appraisal Institute or a full description of the property; 2. Multiple pictures; 3. All available property reports (i.e., environmental, structural, etc); 4. Any specialized reports (i.e., Smith Travel Research report/analysis); 5. If appropriate, a zoning/flood/parking letter, certificate of occupancy, insurance certificate, etc.; 6. A location map showing improvements in the area of our property, an aerial map and legal description; 7. A property improvement plan, if any; and 8. Rent roll, including property specific details. C. Information about the community in which the property is located: 1. Market/demographics of the community; and 2. Any available market study or feasibility analysis. D. Information about the property/tenant(s): 1. A copy of the lease(s) with a lease roll-over analysis, etc.; 2. Any tenant financial information available and/or tenant profile; and 3. Detailed income and expense statements on the property for multiple years and year-to-date. E. Information on management with a resume and/or contract. F. Information about the borrower: 1. The borrower's/entity's history and documentation; 2. Financial statements for multiple years and year-to-date; and 3. Tax returns for multiple years, if appropriate. G. Information about the guarantor(s): 1. Personal resume; 2. Personal financial statement(s), current within 90-days; and 3. Signed and dated tax returns for multiple years, if appropriate. The "executive loan summary" should be detailed enough so that the lender can make an initial decision as to whether or not the property and financial transactions are as you have described them verbally. You should send this summary to the lender prior to sending him the loan package, and the lender should confirm his initial reaction to the transactions that were based upon your verbal description. The purpose of including the summary in the actual loan package is so that it can summarize the contents of the loan package once more. The balance of the loan package simply supports the outline or brief description of the information presented in the executive loan summary. The order in which the information is presented within the loan package should be coordinated with the manner in which the information is presented within the executive loan summary. The proper presentation of the loan package is only one of the steps in the loan process. One first makes contact with potential lenders and has a verbal discussion. Second, if the lender shows interest, one sends the potential lender an executive loan summary. Third, one sends the selected lender a full loan package, and finally, one works out the details and ultimately closes the loan. As in any sales process, the closing of a commercial loan is a series of events that must be coordinated and presented in the best possible manner. When you make that first call to a potential lender, the recipient of that call is evaluating you as much as the potential transaction you discuss with him. Before you attempt to complete a loan package and send it to someone, you should know to whom you may be speaking, what you are going to say, give an accurate description of the transaction and answer the questions that will be asked. If you are not otherwise properly prepared, your well done loan package will be of no value to you except as an exercise. Finally, always be sure that the loan package represents you well, if you expect to close the loan. William Pape, CMC of Commercial Mortgage Brokers has 17 years of commercial loan experience, and works with life insurance companies, conduits and other national lenders. He has held national offices in the National Association of Mortgage Brokers, directed six national commercial conferences and was a designer for the two commercial education courses offered by NAMB. He can be reached by phone at (800) 326-5813 or e-mail [email protected]
Published
Mar 11, 2008
Redwood Trust Completes Merger With Riverbend

Acquisition plans originally announced April 28th.

Industry News
Jul 06, 2022
MISMO Seeks Comment On Enhanced Version Of iLAD

Updated version includes new USDA GUS specification MISMO v3.4

Industry News
Jul 06, 2022
Bankruptcy Court Judge OKs Financing For FGMC

Financing package will allow FGMC to continue to fund loans in its pipeline.

Industry News
Jul 05, 2022
Opteon Acquires Northeastern Appraisal Associates

This is the fourth acquisition Opteon has made in the last 12 months. 

Industry News
Jul 04, 2022
Lenders Complain FGMC Is 'Radio Silent' On Loans

Company said it would stop purchasing new loans in the wake of its mass layoff last week; seeking court-approved financing.

Industry News
Jun 30, 2022
AnnieMac Home Mortgage Acquires OVM Financial

Wants to expand its outreach into the Mid-Atlantic region.

Industry News
Jun 30, 2022