Commercial Real Estate Meltdown Moving Full Steam Ahead
A number of industry experts are predicting a meltdown of commercial real estate prices, just like what happened in the residential market. In a recent interview with CNBC, Elizabeth Warren, Chairperson of the TARP Congressional Oversight Panel stated that "by the end of 2010, about half of all commercial real estate mortgages will be underwater". What a shocking figure! She also said that many mid-sized banks "have these dangerous concentrations in commercial real estate lending."
Lower property values, tighter mortgage underwriting guidelines to refinance and decreased rental income has created the perfect storm for disaster the commercial real estate market. We can expect an increase in commercial loan defaults in the coming months.
Banks don't want the headache of having a non-performing asset on their books. Having a large number of non-performing loans on their books may gain the interest of government regulators who oversee the banking industry. Even the regulators have updated their guidelines to help commercial real estate owners facing foreclosure.
What does this mean for property owners of distressed commercial real estate? Banks are more willing to perform commercial loan workouts to keep these mortages a performing asset.
Commercial loan workouts can reduce or wipe out late fees, make payment arrangements, reduce the interest rate, extend or eliminate balloon payments. Because so many commercial properties are not able to refinance, modifying existing loan terms are much more favorable than foreclosure.
For more information, please go to http://www.MyCommercialLoanWorkout.com
Lower property values, tighter mortgage underwriting guidelines to refinance and decreased rental income has created the perfect storm for disaster the commercial real estate market. We can expect an increase in commercial loan defaults in the coming months.
Banks don't want the headache of having a non-performing asset on their books. Having a large number of non-performing loans on their books may gain the interest of government regulators who oversee the banking industry. Even the regulators have updated their guidelines to help commercial real estate owners facing foreclosure.
What does this mean for property owners of distressed commercial real estate? Banks are more willing to perform commercial loan workouts to keep these mortages a performing asset.
Commercial loan workouts can reduce or wipe out late fees, make payment arrangements, reduce the interest rate, extend or eliminate balloon payments. Because so many commercial properties are not able to refinance, modifying existing loan terms are much more favorable than foreclosure.
For more information, please go to http://www.MyCommercialLoanWorkout.com
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