ARCS 'swap shop' gives borrowers an advantage.
The new Asset Substitution Product gives qualified borrowers a unique advantage. It provides the ability to substitute collateral (one property for another) in the event that an owner wants to sell the first. The substituted property must be of equal or greater value and will carry the original interest rate and loan terms.
By taking advantage of this innovative new product, the borrower avoids the yield maintenance payment at the time of sale.
Previously, the capability for Asset Substitution was only available in the Fannie Mae Credit Facility, for a pool of loans exceeding $50,000,000. This new lending product is available for a single property, making it easily accessible for the average qualified borrower.
In effect, this new loan product "follows the borrower, not the property."
The borrower also has the choice of selling the original property and having the qualified purchaser assume the original loan, if that seller does not want or need to use the Asset Substitution aspect of the loan.
"This is a great example of the creative thinking we've come to expect from Fannie Mae," Levine commented. "Borrowers in this rising interest rate environment can enjoy flexibility and big savings."
ARCS is one of America's leading commercial lenders, capable of providing Fannie Mae, Capital Markets, mezz & bridge financing, and even Freddie Mac in selected regions. In 2005, ARCS provided more than $2.4 billion for 289 properties nationwide, making us the #1 DUS lender once again. The company now services a portfolio valued at nearly $13 billion, representing almost 1,800 loans across 39 states.
ARCS is headquartered in Calabasas Hills, CA and has 10 branch locations: Bend, OR, Calabasas Hills, CA, Dallas, TX, Elk Rapids, MI, Orange County, CA, Princeton, NJ, Reno, Rex, GA, NV, San Francisco, CA, Troy, MI.
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|Publication:||Real Estate Weekly|
|Date:||Dec 6, 2006|
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