Financing in San Francisco>Question Details

Anujato, Home Owner in San Francisco, CA

WHERE CAN I REFI MY TIC LOAN?

Asked by Anujato, San Francisco, CA Sun Apr 15, 2012

I AM LOOKING FOR A BANK OR OTHER INSTITUTION TO DO A REFI ON MY FRACTIONAL TIC LOAN. THERE APPEAR TO BE ONLY 2 AROUND SF THAT WILL DO IT. TIC STRUCTURE IS VERY SIMILAR TO CO-OP STRUCTURE IN NYC SO ITS VERY SURPRISING THAT MORE BANKS DONT LEND TO TICs, ESPECIALLY FRACTIONALLY.

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There was a bank in the midwest who did a few 30 year fixed TIC loans a couple of years ago, but they only did a few and pulled out. They have promised to let me know if they get back into it but most banks don't like holding loans to term. NCB and Sterling are the only ones who do individual TIC loans now - Marin Bank does them but only if they finance the project and their rates are not good anyway. Presumably your agent informed you of this before you purchased the property.

We deal with this type of property a lot - if you ever want to sell give us a call - very tricky so you need someone who is very familiar with marketing them.

Best Regards,

Lance King/Owner-Managing Broker
lance@fixedrateproperties.com
415.722.5549
DRE# 01384425
1 vote Thank Flag Link Mon Apr 16, 2012
There is no secondary market for TIC loans. Because of that, lenders cannot sell TIC loans, must keep them in their portfolio. As a result, those few lenders who make TIC loans (and you are correct, there are only two in the Bay area) can pick and choose whom they lend to, they can set their own rates, loan to value ratios, credit criteria.

The above should not come as a surprise to you. When you bought your TIC no doubt your realtor explained all this, and that is why the TIC you purchased was priced lower than if it had been a condo.

Astrid Lacitis
Keynote Properties
415 860 0765
1 vote Thank Flag Link Mon Apr 16, 2012
TIC, for those unfamiliar with the term stands for TENANTS IN COMMON, a method of taking title with more than one owner (like the others, e.g., joint tenants, community property, sole proprietor, etc.). As you're discovering, and perhaps with a bit of consternation, it is increasingly difficult to get lenders to lend money as liberally as they once did. This is true, as a responder to this post mentioned, because the secondary market, still reeling from the major hurt of the mortgage melt-down, was left with few buyers for the new mortgage loans to be made. The major "buyer/investor" for many mortgage backed securities nowadays is the government. As such, underwriting became stricter, and the purse strings tighter. The bottom line is that even in a robust market getting some additional financing was premised on who the borrower (qualifications) was, and the collateral being used for the security (the property). These two major factors play into your problem. If your property has adjusted (downward), as have a great majority of properties, the security is lessened causing many lenders to shun this type of financing package. If you didn't already try, go back to the lender you have and see if they have anything to offer, if you find, like many are finding nowadays, that the lender puts up more roadblocks to the intended plan, rest assured that you'll find a similar outcome with a majority. If you go the traditional route, you'll get a predictable outcome. You'll probably need to seek out some alternatives, e.g., a credit union or even a hard-money lender, to achieve that refinance. However, be prepared for a lot of red tape.
0 votes Thank Flag Link Mon Apr 16, 2012
Have you tried calling Sterling Bank & Trust? 415-970-9889
Hope that helps!

Best Regards,

Ekta Patidar
REALTOR (R)
DST Capital Investments Inc
Licensed in CA, #01859888
ekta@homesbyekta.com
Cell: 925.998.7391
0 votes Thank Flag Link Mon Apr 16, 2012
Different loan environment than NY, I'm sure. Have you tried talking to the original lender? Also, try talking to a loan broker. I know one that did some good work with a restricted deed (which was very hard).

Questions? Email me.
0 votes Thank Flag Link Mon Apr 16, 2012
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