Bay Area Capital Commercial -
Commercial loans for Non-profit entities
There are many non-profit entities in the marketplace, and many of them own or would like to own commercial real estate. The problem is that most banks, maybe 98% of all the banks, don't really understand how to do a commercial loan for a non-profit entity. The proof is in the documentation they request. If your bank is asking you for a PFS or personal financial statement, or a personal loan application, or is asking about "guarantors", or personal bank statements, W2's or personal tax filings, then clearly they are out of their depth.
The unique aspect of a commercial loan for a non-profit entity is that there are no "guarantors" other than the business itself. Business tax filings, business bank accounts, YTD financials including a profit and loss and balance sheet should be enough. Leases for any tenants are fair game, as are resumes for the management team, operational agreements, and documentation of non-profit status.
We have a uniquely strong relationship with a local / regional bank which specializes in doing work for non profit groups. Specializes is actually too light of a description; it is in this bank's charter to lend to non-profit organizations. Here is what they would offer:
5 year fixed usually low to mid fours (refer this can change)
loan size of $300,000 up to $2,000,000
West coast organizations and property only
25 and 30 year amortizations
1.5 points usually no more
90 day close, appraisal required