When the loan needs a different plan.
Hard money, bridge, construction and DSCR loans have an end date and a business plan behind them. When the plan runs long or the exit moves, there are usually more options than a default. Think helps borrowers, brokers and lenders find them.
What restructuring can look like.
Most workouts land in one of these. Often it is two of them together.
Extend the maturity
The most common fix. The loan stays in place and the lender agrees to more time, usually for a fee and a few months of interest paid ahead. It works best when the property is worth what the plan said it would be and the borrower can show a real exit.
Change the terms
A lower rate for a period, interest-only where it was amortizing, a rebuilt interest reserve, or a payment schedule that matches when the property will actually produce income. Lenders agree when the change protects their position better than the alternative.
Refinance out
A new lender takes out the old one. For a flip that did not sell, that is often a DSCR rental loan. For a bridge, it can be another bridge with a longer runway. We know which lenders will look at a file that is already past its date.
Add or release collateral
Offering a second property, a pledge or a guarantee can buy time on the first loan. Going the other way, a lender may release a lot or a unit as part of a partial payoff that brings the loan back in line.
Negotiate a payoff
When the property is worth less than the loan, a payoff for less than the balance, a short sale or a deed in lieu can cost a lender less than a foreclosure. These are lender decisions, made on facts, and they go better when the borrower comes forward early with a clear picture.
Hold steady while a sale closes
If a buyer is under contract, a short forbearance can bridge to closing. The lender wants proof the sale is real: the contract, the buyer’s financing and the title commitment.
When it comes up.
Almost none of it is unusual. It happens on well-run deals too. What matters is how early the conversation starts.
- The rehab ran long or over. Permits, a contractor who walked, material costs. The budget moved, and the draw schedule moved with it.
- It is not selling at the number the plan used. The after-repair value was right when the loan closed and the market has softened or the comps have not come in.
- The exit refinance did not work. The appraisal came in low, the rate moved, or the rent did not cover the payment at the DSCR a lender needs.
- The maturity is close. Twelve months went fast. The loan comes due in sixty days and the plan is not finished.
- The borrower had a hard stretch. Payments slipped. A lender usually prefers a conversation now to a default letter later.
How it works.
Tell us about the loan
The short form below: the type of loan, the balance, where it stands and what you are hoping for. Ten minutes.
We read the file
We look at the loan documents, the property and the numbers the way a lender will, before we call.
We call you
A person from the Think desk talks through what is realistic, what a lender will want to see, and what can be fixed on your side first.
We take it to the right table
That is the current lender for an extension or modification, or a new lender from the network for a refinance. We build the package so it arrives complete.
What to have ready.
You do not need all of it to send the request. It is what a lender will ask for, so the sooner you gather it the faster this moves.
- The note, deed of trust or mortgage, and any loan modifications already signed
- The current payoff or balance statement and the interest reserve or draw history
- A short written plan: what is left to do, what it costs and when the property sells or refinances
- A recent value: appraisal, broker opinion or comps
- Insurance, taxes and any liens or open permits
- Entity documents and a personal financial statement for any guarantor
Questions we get.
What kinds of loans does this cover?
Investment and business-purpose loans on real estate: fix and flip, bridge, ground-up construction, DSCR rental, land and small commercial or multifamily. It does not cover owner-occupied home loans.
Who is this for: borrowers, brokers or lenders?
All three. Borrowers use it to get ahead of a maturity or a missed payment. Brokers use it when a loan they placed needs a second look. Lenders use it when they would rather see a workable plan than start a foreclosure, and want a package that is complete.
Does Think lend on the restructured loan?
Think is a broker desk. We work with the existing lender where that is the best path, and place a refinance with a lender from the network when a new loan is the answer.
What does it cost?
There is no charge to send the request and talk it through. If we place a refinance, the terms and any fee are set out in writing before you commit to anything.
How fast should I reach out?
As early as you can. A lender has far more room when you ask sixty to ninety days before maturity than after the date has passed or a notice has gone out.
Will the lender agree?
That is the lender’s decision and we cannot promise it. What we can do is make sure they see a clear plan, complete documents and a realistic proposal, which is what moves these conversations.
Request a loan restructure.
Tell us about the loan. A person on the Think desk reads it and calls you, usually within one business day.
Investment and business-purpose loans only.