ReleaseWire

As a result of the current severe economic downturn, distressed properties and overwhelmed homeowners are an all too common reality. Throughout the Phoenix area, homeowners of distressed properties owe more than their homes are worth.

Lenders are more selective than ever with current underwriting techniques reflecting very conservative parameters. And in particular, higher leverage fundings based on project values of the last couple of years are shunned. Instead, most lenders prefer internal valuation/underwriting models rather than simply applying debt service coverage and leverage restrictions to externally-generated valuations (e.g., purchase contracts and third-party appraisals).

The expanding financial crisis hitting global markets as a result of domestic housing continues to torpedo the income-property mortgage market. Lenders and borrowers alike are frantically seeking answers to questions about where markets are heading including pricing, values and acceptable leverage levels.

The old cliché – “Cash Is King” is as true now as ever given the sparse availability of leverage. Nearly all real estate financings, both acquisition and refinancing, are restricted to funding projects with existing, in-place cash flow. Cash-flow projections, projects with value calculations based on appreciation (e.g., land) and other ventures lacking sufficient current income ventures are shunned. Lending is severely restricted as the Real Estate Capital Institute® estimates over 80% of conventional funding sources are temporarily out of the market.

The start of the mortgage meltdown over a year ago continues wrecking havoc on the real estate capital markets. In particular, accurate property valuation is nearly impossible as buyers and sellers are sidelined due to limited debt availability.

The commercial real estate capital markets are tightly strapped into the Wall Street roller coaster with rates jumping up and available funds tumbling down.

Swooning financial markets continue dislodging all sectors of real estate capital with a vengeance. Funding sources retreat from income-property lending on a daily basis because of liquidity concerns, profitability, overexposure and a host of other factors plaguing this sector. No conventional lenders are immune including banks, life insurance companies, savings institutions and private funding sources.

The real estate correction is just that... a true correction of values based on historical norms.

Optima, the UK’s leading supplier of commercial partitioning systems is paving the way to greener construction by promising to eliminate all waste to landfill from their operations by 2010.

The critically important - but often elusive-marketing impact the Internet can afford Realtors and their agents just became easier to attain, with the launch of a new Minneapolis-based firm offering comprehensive web services for the industry.

Gloria Nilson GMAC Real Estate announces the presentation of the Gloria Nilson Community Service Award to Emily Schwab, a sales associate with the company’s Pennington office.

The new year triggers new hopes and fears as real estate capital markets continue readjusting from nearly a decade of uninterrupted volume and pricing momentum. While many investors fear new funding restrictions, others welcome more disciplined and “customary” underwriting practices deemed to be “normal.”

Prepayment penalties can be substantial to borrowers, as well as attractive profit protection for lenders. Borrowers need flexibility, while lenders seek yield preservation.

The highest risks and rewards are clearly centered in the land acquisition and development arena. Land is the first development ingredient impacted by economic cycles as is painfully obvious in today’s residential markets. And even in good times, land is burdened with costs and seldom offers income.

Despite real estate debt market turmoil, overall equity yields for income properties remain near 40-year-lows. While bargain-hunting abounds in the residential arena -- particularly new condominium developments in overbuilt metro areas, investors still crave for high-quality, income properties. While the mode is cautious and selective, funds are readily available as public funds, private capital, foreign buyers and tax-exchange players aggressively hunt for Class-A properties -- assets with strong cash flow and upside potential.

Medical Office Buildings (MOBs) are one of the more exciting development and acquisition opportunities within the income-property investment arena. However, given today's uncertain financing market conditions, these properties require more underwriting knowledge than other conventional property types (e.g. apartment, retail and office properties).

Given this late summer's tumultuous realty capital markets and property oversupply concerns (e.g., retail and residential), borrowers are often puzzled about how new construction loans are underwritten.

Adarsh “A.K.” Sharma recently joined the Montgoemry office of Gloria Nilson GMAC Real Estate as sales associate. Sharma brings 8 years professional real estate experience and 45 years of sales and international sales consultin

Since December, the yield curve remains inverted, suggesting the looming threat of a recession and credit market turmoil. However, the previous time the yield curve inverted within the past decade, a recession did not occur. This phenomenon has proven to be a result of domestic and international investors flocking to longer-term, US debt instruments. The winners, of course, are long-term borrowers.

During the subprime credit crunch of the past two months, most of the focus remains on loan performance and treasury rates. While these indices are accurate gauges of market conditions, a long-ignored index resurfaced on the watchlist -- LIBOR ( London interbank offering rate).

Regardless of technological change, the basics remain the same - all communications are filtered by the five senses of seeing, hearing, touching, smelling and tasting. No small wonder that American business spends billions every day targeting the senses. And, the rules for reaching those senses are changing dramatically.

In today's overheated realty capital markets, most of the underwriting focus is on property location, physical issues and cash flow performance. And in specific instances - particularly long-term, net leased properties - these variables are sufficient enough to accurately underwrite an income-property loan.

The Ritz-Carlton Hotel Company, L.L.C., the leader in global luxury hospitality, has announced plans for its first location in India. The Ritz-Carlton, Bangalore, a 250-room, five-star property, will open in the nation’s third-largest city by early 2010. Developed by Nitesh Estates, The Ritz-Carlton, Bangalore, will be set up in the central business district of the city.

400Bankers.com, a commercial real estate broker/lender database, has recently announce that they made a deal with brokers and lenders in their network to cut closing costs by 40% and max fee allowed to charge on commercial loans is 0.50% of loan amount up to $3 Million. Last year brokers and lenders have generated over $5 Billion in closed deals through 400Bankers.com and this year it's estimated that over six thousand loan applications will be processed and closed by end of year. Due to a high volume of loan applications and high closing ratio there will be 0.50% to zero origination fees charged to borrowers. Average closing costs have been decreased to $4,600 for commercial real estate loans of $1 Million or less. Many borrowers have found out that 400Bankers.com offers very attractive programs and highest LTV options which gives many borrowers great buying power. Some borrowers have received up to 100% financing for commercial real estate and business acquisitions through 400Bankers.com network.

Oviedo, Florida based Mortgage Broker Jan Gudis reveals 3 things you should watch out for when shopping for home-finance products on the Internet.