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Volume 8: Issue 7 | Date: November 26, 2018
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COMMERCIAL LENDING NEWSLETTER
You are receiving this letter because you are one of my Spartans - my top-producing brokers and investor clients - of whom I am allowed to have 300. Removal instructions are below. Today we'll discuss the importance of the net worth of the borrower in commercial real estate lending. We also have lots of cute, clean jokes, some funny pics, and a surprising video of a cop complaining bitterly about a vehicle driving too slow.
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Joke Du Jour
Fifty-one years ago, Herman James, a North Carolina mountain man, was drafted by the Army. On his first day in basic training, the Army issued him a comb. That afternoon the Army barber sheared off all his hair. On his second day, the Army issued Herman a toothbrush. That afternoon the Army dentist yanked out three of his teeth. On the third day, the Army issued him a jock strap. The Army has been looking for Herman for 51 years.
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Still Making Nationwide Permanent Loans From $100K to $3.5M
Do you need a commercial lender who will actually lend up to 75% LTV? Blackburne & Sons has decided to compete against banks by offering a higher LTV.
Do you need a lender who will also look at the borrower's global income - income from salaries, other investments, etc.? Do you need a lender who will allow the seller to carry back a second mortgage? Does your client have a balloon payment coming due on his commercial property? Has your bank offered him a discounted pay-off? Does your borrower have less-than-stellar credit? Is your client's company losing money? Is your borrower a foreign national? Do you need a non-recourse loan? Do you need a commercial loan with no prepayment penalty? Is your client's commercial property partially vacant? Do all of your commercial leases run out in the next 18 months? Do you need a lender who will allow a negative cash flow? Do you need a loan against a portfolio of rental houses?
And don't forget, we will quickly and happily issue you a written Loan Approval Letter - at no charge - that you can use as a fallback and to lure cheaper lenders. After all, everyone wants to lend to you if you already have a commitment. Here is our latest rate sheet.
Blackburne & Sons is looking for commercial real estate loans that are not quite clean enough for a bank. Please click here to submit a hard money commercial loan or call me, George Blackburne IV, at (916) 338-3232 Ext. 314
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Love Pill Joke
A lady goes to the doctor and complains that her husband is losing interest in marital relations. The doctor gives her a pill, but warns her that it's still experimental. He tells her to slip it into his mashed potatoes at dinner, so that night, she does just that. About a week later, she’s back at the doctor, where she says, "Doc, the pill worked great! I put it in the potatoes like you said! It wasn't five minutes later that he jumped up, raked all the food and dishes onto the floor, grabbed me, ripped all my clothes off, and ravaged me right there on the table!" The doctor says, "I’m sorry, we didn’t realize the pill was that strong! The foundation will gladly pay for any damages." "Nah," she says, "that's okay. We're never going back to that restaurant anyway.”
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The Sweet Apartment Loan Program For "A" Deals
Blackburne & Sons has a terrific apartment loan program for "A" quality deals. Our fixed rate is adjusted according to the desirability of the property and the area, but it starts at 4.6257% and 1 point for a 30-year fully-amortized loan. For more details, please call George Blackburne, IV at (916) 338-3232 Ext. 314.
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Vampire Joke
Patient: Doctor, I think that I've been bitten by a vampire.
Doctor: Drink this glass of water.
Patient: Will it make me better?
Doctor: No, but I'll be able to see if your neck leaks.
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- Today's Lesson -
The Importance of Net Worth in Commercial Lending
First of all, do you know everything about commercial real estate finance? I certainly don’t, and I have been doing this for almost forty years. Twice a week I publish a free training lesson in commercial real estate finance on my blog, and as a subscriber, you will receive a copy by email. For example, I recently blogged about the minimum credit score required to qualify for an SBA loan and the effect of a past bankruptcy. To subscribe, just fill in your email address here.
In my past two blog articles, I pounded on the theme that a commercial mortgage broker must not waste his valuable time working on goofy land loans and goofy bridge loans. What makes a land loan or a bridge loan goofy?
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A commercial loan is goofy if the borrower(s)’ net worth is considerably smaller than the loan amount. For example, if a borrower with a $1 million net worth is trying to borrow $10 million, the loan request is goofy.
The rule of thumb in commercial real estate finance (“CREF”) is that a commercial borrower’s net worth must be at least as large as the loan amount. This is called the Net-Worth-to-Loan-Size Ratio.
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Turkey Fact
Turkeys have heart attacks. When the Air Force was conducting test runs and breaking the sound barrier, fields of turkeys would drop dead. (Poor birds)
True story: The Blackburne family once saw a rafter (herd) of 300 huge Tom turkeys run across a dark road and into our headlights. It was Thanksgiving, and these birds were huge and fat. They must have escaped from a truck or farm.
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Submit Your “A” Quality Commercial Loans Using C-Loans
You old veterans know that commercial lenders are incredibly fickle. One moment a bank loves self storage loans, and the next moment - usually after taking a loss - it wouldn't touch a self storage facility loan with a ten-foot pole. C-Loans.com is a commercial mortgage portal that was designed with commercial lender fickleness in mind. You fill out one mini-app, and then you can submit your commercial loan application to bank after bank, six at a time, until you find a bank hungry to make a commercial loan today. Mortgage brokers like you have closed over 1,000 commercial real estate loans totaling over $1 billion, so C-Loans clearly works. And C-Loans.com is free!
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Barking Dog Joke
A blonde and her husband are lying in bed listening to the next door neighbor's dog. It has been in the backyard barking for hours and hours. The blonde jumps up out of bed and says, "I've had enough of this.” She goes downstairs. She finally comes back up to bed and her husband says, "The dog is still barking, what have you been doing?" The blonde says, "I put the dog in our backyard...let's see how THEY like it!”
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CommercialMortgage.com Just Keeps Getting Better and Better
Every day we add two to five new banks and credit unions to CommercialMortgage.com. With almost 4,000 banks, credit unions, and other commercial lenders, CommercialMortgage.com is by far the largest databank of commercial lenders in the country.
Do you understand that CommercialMortgage.com is absolutely free to use? The lenders listed do NOT jack up their loan fee in order to pay a software licensing fee to C-Loans, Inc. One of the most successful commercial mortgage brokers in the entire country is Les Agisim of Trevor Cole Commercial, and Les uses CommercialMortgage.com all of the time. You would be wise to do what the successful guys do.
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The TV Show, "The Punisher" is Now on Netflix, and It's Pretty Good
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The Blackburne List
The Blackburne List is a list of over 2,500 commercial lenders located nationwide. It is available for purchase for just $79.95. Is money tight? You can also buy one of our three Regional Lists (750+ lenders) for just $39.95.
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Blonde’s Mother Joke
A blonde goes to work in tears. She says, "My mom died.” Her boss tells her to go home, but she said, "No, I'll be fine.” Later that day, her boss finds her crying again. He says, "What's wrong?” She replies, "I just talked to my sister, and her mom died, too!"
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Commercial Mortgage Marketing Course - $199
Need commercial mortgage leads? This Commercial Mortgage Marketing Course will teach you how to turn on a flow of commercial leads as easily as turning on a spigot.
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Kisses Joke
Wife: "Our new neighbor always kisses his wife when he leaves for work. Why don't you do that?”
Husband: "How can I? I don't even know her.”
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Have You Been Screwed Out of a Big Loan Fee Yet?
Whenever someone boasts of being a good horseman, I always ask him, “Have you ever been thrown?” The correct answer is, “Many, many times”. There is an old saying, “If you ain’t been thrown, you ain't ridden very much.”
The same is unfortunately true of commercial mortgage brokerage. You will screwed out of a loan fee of $10,000 or more at least twice per year for your entire career. Now I am NOT talking about the borrower closing the loan and not paying you. That rarely happens. What these dastardly borrowers do is lie to you or cancel on you. You would be a flipping idiot not to pay a lousy $199 for my ninety-minute video training course, Fee Collection For Commercial Mortgage Brokers. It includes my famous fee agreement. Go ahead and ignore this section. You will cry, I absolutely guarantee you.
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Honest, My Commercial Loan Package is in the Mail
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Communism Joke
We should have known that communism would fail. There were so many red flags.
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It's the Loan Servicing Income, Folks
No one ever listens to me. Please pay attention! The money in the mortgage industry is in loan servicing fees, and servicing loans is easy. For your first 50 deals, you can just hire a sub-servicing company for $40 per loan per month. I charge my investors $1,583 per month (!!!) for servicing a one-million dollar loan. $1,580 per month minus $40 equals...The loan servicing portfolio for Blackburne & Sons just broke $53 million this quarter. Since our average loan servicing fee is two percent annually, that means we earn over $1 million per year for servicing just 250 loans. How would you like to walk in the door on the first of each month knowing that you will earn at least $83,000? Find your own private mortgage investors.
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Asexual Joke
I told my Asian parents that I am asexual. They were disappointed that I wasn't A+sexual.
Asexual: Without sexual feelings or associations. (I had to look it up.)
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We're Now Making Business Purpose Rental Home Loans in Most States
These loans are sometimes known as buy-to-rent loans. For the past 38 years, Blackburne & Sons has exclusively been a commercial lender. This has now changed. We are aggressively seeking non-owner occupied home loans in these states:
- California
- Florida
- Arizona
- Washington
- New Jersey
- Missouri
- Maryland
- Ohio
- Alaska
- New York
- Texas
- Virginia
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Probably your state too. We'll quickly call our attorney.
- Nevada and Minnesota are unfortunately out.
The property has to be non-owner occupied, and the purpose of the loan must be for business. The nice thing about business purpose home loans from Blackburne & Sons is that our loans have a 30-year amortization, a 15-year term and no prepayment penalty.
Got a commercial deal nationwide or a business purpose, non-owner-occupied residential deal in one of the above four states? Please call me:
George Blackburne, IV
Loan Representative
P: (916) 338-3232 Ext. 312
georgeiv@blackburne.com
NMLS #382112
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Liquor Store Joke
I was browsing in a liquor store when an employee asked me “Do you need help?” “Yes,” I replied, "but I’m here to get whiskey instead.”
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Growing up, when I would hear about a natural disaster in some other part of the country, I would feel bad for a day but then go about my life. It wasn’t that I was cold, but when you listen to the news it was/is very clinical; like a statistic on some far off case study. It wasn’t until I got older that I realized these numbers are people. People like me. People who just lost everything, and had no where to go.
With all the chaos the wildfires in California are causing, it made me realize how both vulnerable and grateful I am. This year, when I sit down for Thanksgiving I am going to be thinking about how many people just lost their kitchen table, their homes and in some cases their lives. I am going to be grateful I still have a roof over my head and that my family is safe. I am also going to do what I can to help others.
If you can, make a donation to your local charity. Every little bit helps. A $10 donation (1 and 1/2 cups of Starbucks coffee) can make a huge difference for someone. Stay safe this holiday season.
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George Blackburne, IV
CA DRE #01873244
NMLS #382112
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Final Funny
Boy: *Calls 9-1-1* "Hello? I need your help!"
911: "Alright, what is it?"
Boy: "Two girls are fighting over me!"
911: "So what's your emergency?"
Boy: "The ugly one is winning."
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Read the C-Loans Blog
Pick up lots of great commercial brokerage practice tips for free.
Click here and bookmark it.
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BLACKBURNE & SONS
Realty Capital Corporation
4811 Chippendale Drive
Suite 101
Sacramento, CA 95841
P: (916) 338-3232 // F: (916) 338-2328
CA DRE #829677 // NMLS #103430
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George Blackburne III, Esq.
Owner and President
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CA DRE #00623143
NMLS #104120
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A member of the Blackburne Family of Companies
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