Apartment Financing
By Troy Barker
One of the key aspects of a successful apartment
investment is the way in which the property is financed. Too often, owners
and managers are unaware of the various financing options available in the
marketplace, or the costs involved.
Additionally, many real estate owners are not aware
of the process which a Lender goes through in order to review and approve
the Borrower’s financing application. Some questions which often arise
include:
- What is the maximum loan amount I can
expect?
- What interest rate options are
available?
- What does the Lender need from me in terms of
information?
- How long will it take to approve the
loan?
- Can I use my own lawyer to do the
financing?
- Do I need a Real Property
Report?
- What costs are
involved?
- What is a CMHC insured mortgage and what are the
benefits?
- Can I get a loan to facilitate renovations to my
building?
In order to provide a
general overview of apartment financing, Peoples Trust will be holding a
Financial Seminar on Thursday, March 20th at the Blackfoot Inn beginning
at
This year’s seminar will be amended from previous
years, to allow for the presentation of different financing options (CMHC
vs. conventional) as well as other considerations including Rental
Achievement Holdback loans (floor to ceiling loans), renovation
loans/condo conversions and alternative repayment
options.
The seminar will focus on the comparison between
CMHC insured and conventional mortgage financing. Specifically, we will be
discussing the various requirements for a CMHC mortgage application and
the underwriting involved. We
will then compare this to the requirements for a typical conventional
mortgage loan.
An examination of the various pros and cons for
each financing option will also be presented. Some items of comparison and
topics of discussion will include:
- Overview of financing
options
- Underwriting / maximum loan
calculations
- Interest rate
options
- Timing
- Re-finance options
- Terms and
amortizations
The rest of the presentation will focus on answering some common questions and presenting some unique financing options.
Throughout the seminar, we will try and answer
questions from the audience, however there will be a question and answer
period available at the end of the presentation. This year, we look
forward to expanding the presentation to allow for an extended question
and answer period and to allow for discussion of unique financing
scenarios.
This seminar will be of benefit to anyone who
either presently owns or manages apartment properties as well as those who
may be interested in real estate investing.
We encourage you to register early for this seminar
by contacting the Calgary Apartment Association office at 265-6055. We look forward to
seeing everyone at this informative seminar on March
20th.
Troy Barker is the Manager, Commercial Mortgages,
Prairie Region at Peoples Trust. He can be reached at (403)
205-8202.
