Lenders usually require a minimum debt service coverage ratio which typically ranges from 1.1 to 1.4; the ratio is net cash flow (the income the property produces) over the debt service (mortgage payment). As an example if the owner of a shopping mall receives $300,000 per month from tenants, pays $50,000 per month in expenses, a lender will typically not give a loan that requires monthly payments above $227,273 (($300,000-$50,000)/1.1)), a 1.1 debt cover. Lenders also look at loan to value (LTV). LTV is a mathematical calculation which expresses the amount of a mortgage as a percentage of the total appraised value. Commercial mortgage LTV's are typically between 55% and 70%, unlike residential mortgages which are typically 80% or above. Lenders look at rents per square foot, cost per square foot and replacement cost per square foot. These metrics vary widely depending on the location and intended use of the property, but can be useful indications of the financial health of the real estate, as well as the likelihood of competitive new developments coming online. Since the financial crisis, lenders have started to focus on a new metric, debt yield, to complement the debt service coverage ratio. Debt yield is defined as the net operating income (NOI) of a property divided by the amount of the mortgage. Lenders typically do thorough due diligence on a proposed commercial mortgage loan prior to funding the loan. Such due diligence often includes a site inspection, a financial review, and due diligence on the property's sponsor and legal borrowing entity. Many lenders also commission and review third-party reports such as an appraisal, environmental report, business valuations, engineering report, and background checks.
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Mission Statement/Vision
VII Capital Funds brings several Business, Financial and Commercial Private Industries together through interconnecting programs. Combining our Experienced and Expert Real Estate Commercial Lending Professionals with flexible Commercial Loan Programs and Products that help our clients realize their Project Development dreams. We offer Private Loan Financing, Commercial Loans, Commercial Property, Retail Loans, Industrial Loans, Strip Mall, Office Building Loans, Shipping and Cruise lines, Lines of Credit, Manufacturing, Commercial Fishing Vessel, International Business Loans, Venture Capital Lending, Medical Loans, Real Estate Development, Resorts, Hotel - Lending, Mixed Use, Start-Up Lending, Commercial Renovation Loans, High-rise, Financing, Consultation and Structuring of existing or Refinancing of existing loans to improve our client’s ability to Fund, Buy, Develop and Build their business both locally and abroad. VII Capital Funds offers Manageable loan services, diverse lending products for Commercial and Private Ventures including Equity Partners, SBLC -BG and quantifiable knowledge that is flexible, usable and creates value in Commercial Real Estate Matters. VII Capital Funds utilizes Private Placement Programs through the U.S. Federal Security & Exchange Commission (SEC) – 540, 505 and 506 filings for Raising Capital to diversify our portfolio just to name a few. VII Capital Funds Also Associates with other Insurance and Investment Professionals in expanding our client’s ability to receive industry advice and products with Financial Planning, Consultation, Investment Products, Market Investments, Life Insurance, Business, and Protection Products from other producers licensed and regulated in these fields of industry.