Frequently Asked Questions

Eligible property types for a Mircolend include those with:

● Certain tax abatements

● Short-term rentals, with a portion of the total unit count

● Micro-units of 350 SF or less, with a portion of the total unit count

● Seniors housing without resident services

● Commercial (non-residential) space or income, with a portion of the total space and income

● No more than 50% concentration of students, military personnel, or single employers

● Tenant-based rental assistance

● No more than 20% of units encumbered by a HAP contract

● Affordability restrictions or tax credits lasting up to two years

● Master Lease concentration comprising no more than 25% of total gross potential rent (GPR)

● Non-contiguous parcels with buildings having 5 or more units in the same MSA

● Buildings with less than 5 units on the same or contiguous parcels

● Private wells and/or septic tanks, common in the market

● Fractured condominiums, controlling a minimum percentage of the association

● Manufactured Housing Communities (MHCs)

● Scenario expected loss (SEL) of ≤40%

Obtain preliminary loan terms by sharing basic property details and discussing specific needs and objectives with a Microlend Services.

Receive loan quotes after supplying additional information and property documentation.

Choose a quote and complete a loan application outlining the agreed-upon terms.

Provide the necessary documentation for the loan to undergo underwriting and approval by the lender.

Execute a loan commitment that confirms the final loan terms.

Secure your interest rate and finalize the loan closing process.

On average, the timeline from application to closing usually spans 60-70 days. Nevertheless, with expedited third-party reports and timely submission of all due diligence, it might be feasible to close in as little as 45-55 days.

For Microlend Services, a segment of the rate remains unsecured until the due diligence phase concludes, typically within 30-60 days after receiving a completed loan application. Rates are secured upon the execution of the loan application, provided a comprehensive due diligence package is submitted to Microlend Services within 35

At the very least, you'll need to provide the following documents:

● Current rent roll

● Trailing 12-month operating statement

Property operating budget

Additionally, having the following information and documents ready can streamline the process and preempt potential issues:

For Borrower:

● Ownership structure and percentages

● Bio/resume of the borrower(s)

● Estimated net worth, liquidity, and FICO scores of borrower(s)

● Schedule of real estate owned (SREO) for borrower(s)

● Information about third-party property managers (if applicable)

For Property:

● Commercial (e.g., retail or office) rent roll (if applicable)

● Physical occupancy data for the past 12 months

● Cost basis, existing loan amount, and expected closing costs like prepayment penalties (for refinancing)

● Details on recent or planned capital improvements (if known)

● Interior and exterior property photographs

● Offering memorandum (if accessible)

● Concentrations of student, military, or other types of tenants (if applicable)

● Rent and/or affordability restrictions tied to the property

● Any unique property attributes such as tax abatements, short-term rental arrangements, micro-units, or specialized residential services like those for certain seniors housing setups.

Permissible ownership structures under the Microlend Services include:

● Individual

● Single asset entity (typically in the form of an LLC)

● Multiple asset entity (with conditions; typically in the form of an LLC)

● Revocable and irrevocable trusts (with conditions)

● General partnership

● Corporation

● Real estate investment trust (REIT)

● Tenancy-in-Common (TIC) with five or fewer members

● Not-for-profit corporations (with conditions)

● Funds

Ownership structures not eligible include:

● Series LLCs

● Transactions involving in-place Hard Preferred Equity or Subordinate Debt

● Land Trusts/Delaware Statutory Trusts

● Pension or Retirement Accounts

In order to meet the eligibility criteria for Microlend Services, individual borrowers or key principals are required to demonstrate a combined net worth equivalent to or exceeding 1x the desired loan amount. Additionally, liquidity must be at least equivalent to 9 monthly payments of principal and interest, typically around 5-10% of the desired loan amount.

For individual borrowers, a minimum FICO score of 680 or higher is generally necessary. However, there might be some flexibility if there are multiple key principals involved.