Delinquencies on Commercial Property Loans Hit 5 Year Low
[{"id": "cbt7sm3", "text": "Does this mean mortgage rates are going to drop? Been looking to purchase another building but I guess I am waiting for the right time. Pre-2007/8 was a great time for commercial property loans. Things haven't quite been the same since then. ", "replies": [{"id": "cbt7tpf", "text": "Well I should ask, is this a nation-wide trend rather than chicago based?", "replies": [], "depth": 2}, {"id": "cbtpx55", "text": "In Chicago we've seen a small uptick in interest rates in the past month, and, honestly, I wouldn't expect them to drop again soon. As recently as three months ago, cre loans (for good credit borrowers) were being offered at about 5%, but with 30%-35% down. This article mentions a new deal being done by a smaller bank at 25% down. I'd see this as the trend, lower down payments, instead of lower interest rates. \n\nPre-2008 loans were being offered at 20% down regularly, but at 6.5% interest rates, as the prime rate was substantially above the 3.25% level it's been at since December 2008. For instance, the prime rate on January1, 2008 was 7.25%.\n\nSince the crash in 3Q 2008, interest rates have fallen dramatically, but lending guidelines, ie. credit requirements and l-t-v ratios, have increased (become stricter) and that's what made it more difficult to get financing. This in turn created the \"credit crunch.\" ", "replies": [], "depth": 2}], "depth": 1}]