C-LOANS BANKER LETTER
This letter is intended only for commercial mortgage loan officers working for banks and hard money lenders. Today we'll talk about why all these new hard money mortgage funds are going to fail. And, of course, because this is C-Loans (the jokesters), we have lots of cute, clean jokes, some funny pics, and a pretty funny gag video.
Joke Du Jour
My wife asked me to buy ORGANIC vegetables from the market. I went and looked around. I couldn't find any, so I grabbed a harassed and tired-looking employee and said, "These vegetables are for my wife. Have they been sprayed with any poisonous chemicals?" The produce guy looked at me and said, "No, sir, you'll have to do that yourself."
Annie is Awfully Quiet
Ever Wonder What a C-Loans Application Looks Like?
Here's a sample commercial loan application.
Wedding Vows Joke
A grandmother overheard 5-year-old Christy "playing wedding." The wedding vows went like this: "You have the right to remain silent, anything you say may be held against you, you have the right to have an attorney present. You may kiss the bride."
Please Refer Your Commercial Loan Turndowns to Either CommercialMortgage.com or C-Loans.com
If you turn down a commercial real estate loan this week, would you kindly refer the borrower to CommercialMortgage.com (probably an easier web site name to remember) or C-Loans.com? CommercialMortgage.com sure better be easier to remember! We paid $100,000 just for that domain name. If none of our 4,000 different commercial lenders can help him, the deal probably isn't do-able. Thanks so much!
"A man in Oregon walked away with minor injuries after he fell asleep in a dumpster and ended up in a trash compacter. This raises a lot of questions, and the answer to all of them is tequila." -- Jimmy Fallon
All of These New Hard Money Mortgage Funds Are Going To Fail
About two-hundred new hard money mortgage funds have arisen from the ashes of the Great Recession. After all, its relatively easy to hire an attorney to create the legal documents to form a new mortgage fund, and private investors are flocking to these brand new outfits for a chance to earn double-digit returns. Unfortunately almost all of them will crash disastrously in the next recession. Here's why:
Most hard money mortgage funds only make bridge loans - loans with terms of one to two years. The sponsor makes two to three points for originating each loan, plus maybe 75 bps. for servicing. The bottom line is that the sponsors of these mortgage funds make 70% of their dough from originating new loans, as new deposits flow into their pools and as old loans pay off.
Unfortunately, bad real estate slumps seem to hit every seven to twelve years. When real estate values fall 20% to 45%, the losses to the fund start to mount. Once the investors start to smell these losses, they panic and demand their money back. Millions of dollars flow out of these mortgage funds, and hardly a penny flows back into them.
Soon the Sponsor has no new money with which to lend, so his loan fee income virtually disappears. Remember, this loan fee income used to constitute 70% of the Sponsor's income. Without enough income to pay salaries and rent, the Sponsor is eventually forced to close his doors.
Without the sponsor to shepherd the collection efforts- making collection calls, filing foreclosure, getting borrowers out of Chapter 11 Bankruptcy, hiring attorneys, hiring foreclosure companies, hiring contractors, hiring property cleanup crews and hiring real estate brokers - this portfolio of once decent loans invariably gets crushed. Eventually the government moves in to clean up the mess. Greedy attorneys, trustees, and accountants feast. The investors get fleeced.
Am I exaggerating? There were aound 150 hard money mortgage funds in business before the Great Recession. Fewer than six survived.
Getting Hungry For Commercial Loans Again?
As a lender, should you join C-Loans.com or the faster, easier portal, CommercialMortgage.com? It depends. If you'd like to close an extra couple of commercial loans every year, you should probably just join CommercialMortgage.com. If you are serious about expanding your commercial lending division, however, you should definitely join C-Loans.com. You will get far more applications.
"The Canadian food inspection agency announced that gin is being recalled. The recall was announced because bottles of Bombay Sapphire gin were found to contain 77 percent alcohol by volume rather than the typical 40 percent. Here's how you can tell--normally, gin tastes like juniper with hints of lemon and coriander. Seventy-seven percent alcohol gin tastes like regret, with hints of fighting a parking meter." -- Stephen Colbert
Bankers: Get 200 Free SBA Loan Applications
Does your bank want to close more SBA loans? C-Loans.com will give you two hundred SBA loan leads for free, deals that are perfect for your bank. These loans will be the right size. They will be located only in your favorite counties of your favorite states, and these SBA loans leads will be secured by just the type of commercial real estate that you prefer - office buildings, industrial buildings, etc.
Please click here for more information about how to receive 200 free SBA loan applications. The above offer is made only to commercial banks and credit unions.
What if you don't work for a bank or credit union, but your commercial mortgage company services more than $20 million in commercial real estate loans? We have a fine program for you too. Please call Tom Blackburne at (574) 210-6686 or click here for more details.
Not Married Joke
Sitting in the bar, George asked his 40-year-old friend John, "How come you aren't married?" John: "I haven't found the right woman yet." George: "So what are you looking for?" John: "Oh she's got to be real pretty, a good cook and house keeper, she's got to know how to handle finances, have a forgiving personality -- and money, she's got to have money, and if she has her own house it wouldn't hurt either." George: "A woman like that would be crazy to marry YOU!" John: "Oh, it's okay if she's crazy."
Free Commercial Mortgage Marketing Course
You've got a buddy who works as a commercial loan officer at a neighboring bank, right? We'll trade you the contents of one of his or her business cards for a free commercial mortgage marketing course. We sell this popular course separately on C-Loans.com for $199. Learn how to turn on a flow of SBA and conventional commercial mortgage leads as easily as turning on a spigot.
Important note: This has nothing to do with joining C-Loans as a lender. For more information, please click here.
Star Wars Joke
"Today was Star Wars Day, because the day was May Fourth, as in 'May the fourth be with you.'' And now, it's technically May Fifth, Cinco de Mayo, as in 'May the fifth margarita be in you.'" -- James Corden
Join C-Loans For a Flat Fee
Most banks that join C-Loans take advantage of our free guaranteed success program; but a bank can now join C-Loans, get listed on our Suggested Lender Lists, and receive tons of commercial mortgage loan applications for a small monthly fee:
For banks with less than $2 billion in assets, the cost is just $250 per month, and up to three loan officers can receive our SBA and commercial real estate loan leads.
For banks with more than $2 billion in assets and less than $7 billion in assets, the cost is just $350 per month, and up to four loan officers can receive our SBA and commercial real estate loan leads.
For banks with more than $7 billion in assets and less than $15 billion in assets, the cost is just $500 per month, and up to five loan officers can receive our SBA and commercial real estate loan leads.
For banks with more than $15 billion in assets, the cost is just $1,000 per month, and up to ten loan officers can receive our SBA and commercial real estate loan leads.
Important note: In all of these cases, the bank owes nothing more, even if it closes a loan.
To join C-Loans using our new flat-fee program, please email Tom Blackburne, General Manager, or call him at 574-210-6686.
But, once again, most banks joining C-Loans, take advantage of our free guaranteed success program, where the bank only pays C-Loans, Inc. a software licensing fee of 0.375 points (just 25 bps. on deals over $5MM) if it closes a commercial loan from C-Loans. Most banks simply increase their normal loan origination fee from 1.0 point to 1.375 points to cover the cost of using our software and receiving our leads. This makes C-Loans effectively free to the bank.
To join using our guaranteed success program - effectively free to the bank - simply use this super-easy form to join C-Loans as a lender.
My friend's son worked at a fast-food restaurant when he was in high school. One night while he was manning the drive-thru, a customer told him that the intercom wasn't working properly. My friend's son went about filling the order while a female co-worker fiddled with the intercom. She asked, "Is that okay now?" "Well, no," the customer replied. "Now you sound like a girl."
Referring Your Turndowns to C-Loans.com (or CommercialMortgage.com) Gives Your Customers a Good Place to Look
If you have to turn down a bank customer's request for a commercial loan, it will help him if you could suggest a place for him to look elsewhere. With 750 different commercial real estate lenders participating on C-Loans.com, if your customer can't qualify for a commercial mortgage from us, he probably won't qualify anywhere. Thank you so much!
Counting Joke (PG-13)
There was a little boy who had just learned to count on his fingers. One day his uncle came to visit, and the boy was anxious to show off his newly acquired skill. He told the uncle to ask him an addition question. So the uncle asked, "What is three plus four?" The little boy counts it out on his fingers and said, "Seven." The uncle said, "Listen kid, you can't count it out on your hands because someday when you are in school, a teacher will get mad at you for it. Now put your hands in your pockets." So the little boy put his hands in his pockets and his uncle asked, "What is five plus five?" After a few moments of intense concentration, the boy said, "Eleven."
How To Close Investor Commercial Loans When Your Loan Committee Won't Exceed 62% LTV
Suppose one of your better bank customers wants to buy a commercial building, not for his company, but rather just for investment. The deal cash flows perfectly at 75% LTV, but your nervous Loan Committee cuts the deal back to just 62% LTV. "Gosh, I have been a good bank customer for decades. I thought my own bank would take better care of me."
The sister company of C-Loans, Blackburne & Sons, raises small balance JV equity for such deals, and we'll raise as little as $100,000. We'll add our equity to your customer's down payment to create a down payment large enough to satisfy your Loan Committee.
Got a potential deal? Please complete this simple preferred equity application or call Angela Vannucci at 916-338-3232.
Should I Work Out?
Ugly Suit Joke
When the store manager returned from lunch, he noticed his clerk's hand was bandaged, but before he could ask about the bandage, the clerk had some very good news for him. "Guess what, sir?" the clerk said. "I finally sold that terrible, ugly suit we've had so long!" "Do you mean that repulsive pink-and-blue double-breasted thing?!" the manager asked. "That's the one!" "That's great!" the manager cried, "I thought we'd never get rid of that monstrosity! That had to be the ugliest suit we've ever had! But tell me, why is your hand bandaged?" "Oh," the clerk replied, "after I sold the guy that suit, his seeing-eye dog bit me."
Would You Mind a $21,250 Referral Fee?
We once paid a $21,250 referral fee to a website owner named Alan Dunn of Spydercube.com for referring us a $17 million deal. Not long ago, we paid our friends at RealWebFunds.com an $11,000 referral fee.
We've made it super-easy to refer us commercial loans and to receive big referral fees. Please click here for details.
It moves fast.
Birth Control Joke
"On this day in 1960, the FDA approved the world's first commercially produced birth control pill. And on this day in 1961, the first couple learned what 99.9 percent effective means." -- Seth Meyers
CommercialMortgage.com Really Is Free For Banks To Join
Stop! This has nothing to do with joining C-Loans.com. This is a totally different portal with totally different rules.
You can list your bank on CommercialMortgage.com in just four minutes for free. There is no set-up charge. There is no monthly fee. You don't even owe a fee if you close a deal. Unlike C-Loans.com, your listing is truly 100% free.
Your bank could surely stand to make a few more commercial loans. You would be absolutely nuts not to add your bank to this very active new portal (1,100 commercial loan app's in the first three weeks). Please click here to add your bank to CommercialMortgage.com.
Are you confused as to how C-Loans, Inc. could afford to spend $250,000 creating a new commercial mortgage portal that competes against its own flagship site, C-Loans.com? How can we afford to provide this site for free to both the borrowers and bankers?
The Blackburne family of commercial mortgage companies (est. 1980) also includes Blackburne & Sons Realty Capital Corporation. This hard money commercial mortgage company makes 15 year commercial loans nationwide using the funds of our 1,500 private investors. We earn a 2% loan servicing fee (200 bps!) on these loans, so if a loan stays outstanding for 15 years, we earn 33 points, including our typical 3-point origination fee. That's $330,000 in gross profit on a hard money loan of just $1 million.
By creating this free new portal, we get to look at every commercial loan that enters CommercialMortgage.com. Picture us as a grizzly bear, knee deep in the river, during salmon spawning season. So take your free listing on CommercialMortgage.com and run. Our new portal really is 100% free to your bank.
[OMGoodness, I belly-laughed sooo hard.]
For a computer programming class, I sat directly across from someone, and our computers were facing away from each other. A few minutes into the class, she got up to leave the room. I reached between our computers and switched the inputs for the keyboards.
She came back and started typing and immediately got a distressed look on her face. She called the teacher over and explained that no matter what she typed, nothing would happen. The teacher tried everything. By this time, I was hiding behind my monitor and quaking red-faced.
I started to type, "Leave me alone!" They both jumped back, silenced. "Whaa??" the teacher blubbered. Then I typed, "I said leave me alone!" The kid got really upset. "I didn't do anything to it, I swear!" It was all I could do to keep from laughing out loud. The conversation between them and HAL 2000 went on for an amazing five minutes. Me: "Don't touch me!" Her: "I'm sorry, I didn't mean to hit your keys that hard." Me: "Who do you think you are anyway?!" Etc.
Finally, I couldn't contain myself any longer and fell out of my chair laughing. After they had realized what I had done, they both turned beet red. Funny, I never got more than a C- in that class.
One Final Pathetic Plea
If you won't let us pay you a referral fee, won't you please-please refer your commercial mortgage turndowns to C-Loans.com or to CommercialMortgage.com? Thanks!