If you require a mortgage for an existing student residence, or one that is in the process of being built or renovated, we welcome the opportunity to discuss your mortgage financing needs directly with you.
One of the key lending criteria for financing a student residence will be location. Lenders will want to know the distance from the residence to the school, historical vacancy rates, student housing capacity in the area, comparable student housing costs in the area and vacancy rates for similar facilities.
Basically, the local market supply and demand statistics are going to be important to any lender considering long term mortgage financing on a student housing facility.
When applying for a commercial mortgage, lender’s will want to first have a full application completed that outlines the ownership structure for the property as well as all the related property information.
For instance, there will be a great interest in the rent roll for the residence as well as any other management information reports that are available to provide data on rents paid, vacancies, seasonality in the occupancy and so on.
From a debt servicing point of view, the application will need to provide accountant prepared financial statements for the last three years if possible as well as well supported set of projections that include a detailed listing of assumptions used to create the forecast and the source documents and logic that support the source documents utilized.
In terms of the physical property, an appraisal is going to be required along with an environmental audit from a lender approved environmental engineer.
From the time of application to funding, most applications for this type of financing can be completed in a 30 day to 60 day period of time.
That being said, the timelines can get extended if additional time is required to complete outside or third party work such as the completion of financial statements, property appraisals, environmental audits, market studies, and so on.
The goal is always to try and cover off all requirements as quickly as possible, regardless of the source for any one particular lender requirement.
The reality at times, however, is that the coordination necessary to meet all lender requirements to first get an approval and then get the deal funded can take longer than anticipated, due mostly to the number of people that can be involved in the application process.
So while 30 to 60 days is a good guide to work from, the sooner you can start the process the better to allow for potential timing issues down the road.
If you require student residence financing right now for a property you own or are trying to acquire, I suggest that you give me a call so we can go through your requirements together and discuss different commercial mortgage funding options that can meet your business needs.
I'm a Toronto Mortgage Broker that arranges mortgage solutions on residential and commercial real estate property. With over 30 years of mortgage financing experience, I'm able to quickly assess your financing requirements and provide relevant solutions for your immediate consideration. Joe Walsh Google+ YouTube Channel