Lending

The Lending Process

Our in-house lenders work with borrowers throughout the lending process.

• Origination phase
• Underwriting phase
• Credit approval phase
• Contracting phase
• Funding and administration phase

The origination phase includes the participation of our in-house lenders in local markets to better understand local market trends and changes in local market economics. This hands-on approach and knowledge of local market participants is a cornerstone in our evaluating lending opportunities brought to us for financing. Our initial assessment includes, but is not limited to, a thorough understanding of an opportunity’s “fit” in the market place, its sponsorship, and financial realities.

Based on initial assessments, our in-house lenders may request additional background and overview information to assist them in the development of a letter of intent which outlines the terms and conditions upon which the lender is prepared to consider financing for the project under review. Our letter of intent outlines:

• Proposed loan terms
• Proposed structure of the loan
• Security granted
• Borrower release for credit bureau and other review items, and
• Additional information as required – project dependent

The underwriting phase involves our in-house lenders reviewing all provided information and other sourced data, and the preparation and presentation of a credit submission to the lender’s credit committee. Credit submissions typically include discussions on the project, its market fit, project budget, sales and / or leasing projections, construction specifications, floor plans, zoning status, location details, environmental reports, geotechnical investigation, building condition analysis, as well as:

• Borrower and guarantor(s) – financial statements, experience, prior loan history, personal financial information, credit bureau reports
• Third party market reports – appraisal, realtor interviews, physical inspection comments, competing project analysis, demographics, market dynamics
• Lending terms and conditions
• Security to be granted, and
• Exit strategy – exploration of all potential sources of repayment

The credit approval phase includes, but is not limited to, a detailed discussion and review of the data points included in the credit submission.

The contracting phase involves the borrower and guarantor(s) acceptance of a commitment letter generated by the lender after credit submissions have been reviewed and approved by the lender’s credit committee.

The funding and administration phase is managed by the lender’s mortgage services group and involves the review and satisfaction of all conditions precedent to funding and registration of security granted in the commitment letter.