Most Commercial Mortgage Brokers I come in contact with are missing an opportunity to make a LARGE commission check. When they encounter a borrower with existing secured debt of 80-90% of the property’s value, they turn the borrower away because they can’t get a refinancing large enough to pay off the existing liens.

In a number of these cases the current lender, once he is apprised of the situation, is willing to accept an immediate cash payment of something less than the full amount owed as payment in full. We have been successful purchasing the existing note at a discount, and either refinancing with a new note or modifying the existing note. In all cases the mortgage broker who brought us the loan received more than he would have with a conventional refi.

In one case, a bar in a suburb of Chicago, the borrower owed more than the property was worth in a first and second lien. We negotiated to buy the first lien for a 40% discount, and to pay off the second lien at a 68 % discount (granted, a significant part of the principal balance was past due interest and associated fees). Btw, when the borrower is in default it is actually EASIER to negotiate a discounted payoff with the existing lender.

We’d be happy to look at any loan application you have and see if we can help.