As the credit crisis worsens, many developers are having to turn to non-traditional lenders to finance their projects. Metro Funding Corp. (MFC), a private asset-based lender, headquartered in Paramus, N.J., recently announced the funding of a $1,300,000 loan for the construction of an assisted living facility in Big Bear, CA. The loan was cross-collateralized with other property to increase the loan-to-value. While the terms and conditions of the loan were not announced, it clearly shows that some developers are able to find financing but on much different terms than on previous projects.
The borrowers, seasoned developers and marketers, approached MFC after having difficulties in obtaining conventional financing. “The conventional banks are not entertaining most construction loans in today’s market, even with strong borrowers and business plans such as this one,” says Ben Rutkevitz, Manager at MFC. After careful underwriting, MFC was able to structure the transaction in a way that benefited all parties and allowed the developers to proceed with the construction.