Mini-perm

Permanent Loans

Sometimes you don’t need a long-term loan, or a short term – you need a loan that is just right. We can help you with a competitive and customized medium--term loan that meets your needs so you can focus on your organization’s mission.

Uses Acquisition and rehabilitation or repositioning of operating multifamily rental, commercial, and mixed-use properties, including New Markets Tax Credit-financed developments
Loan amount Up to $7,500,000
Loan term 5 or 7 years with 15-year or 30-year amortization
Interest rate Please call us for current fixed rates
Collateral/security 1st or 2nd position mortgage/deed of trust and assignment of rents on the financed property
For NMTC-financed properties, security will include pledge of ownership interests, grant funds, earned developer fees, where direct security interest in real estate is not permitted.
Recourse &
guarantee
Loan will be recourse to the Borrower for any outstanding principal amount greater than 80% of the property value. If the Borrower is an SPE, the Sponsor will provide a repayment guarantee for the same amount. Industry-standard nonrecourse carveout provisions will be applied.
Loan to value Maximum of 95%, based on appraised value with stabilized occupancy
Payments Monthly P&I payments based on 15 to 30-year amortization
Debt service payments and replacement reserve deposits made from property cash flow
Debt coverage Minimum DCR of 1.15x for 1st position loans, 1.05x for 2nd position loans DCR calculation includes replacement reserve deposits (if required)
Replacement reserves May be required for loans with 7-year term. Underwritten replacement reserves will be determined by Property Condition Report, estimating the amount needed for capital investment during the term of the loan. Replacement reserves will be collected, held, and controlled by NeighborWorks Capital.
Prepayment premium Three percent (3.0%) for the first 12 months after closing, declining by 1% annually through the first three years of the loan term. No prepayment penalty after three years.
Repayment source Refinancing or sale of property
Fees Application Fee - $1,000
Origination Fee - 1.00% to 1.50% of Loan Amount
Third-party reports Appraisal, Phase I/II environmental, property condition report, market analysis (for repositioning)

Want a little more general information about permanent loans? Check out our Technical Assistance Guide. In just four pages we’ll show you how to: 

  • Compare loan terms
  • Choose the right lender for your property
  • Prepare for your loan application
  • Know what factors your lender will consider