California Commercial Loan Modification Company
Commercial Loan Modification FAQ’s
What is a Commercial Loan Modification?
A commercial loan modification is the process of providing for either a permanent or a temporary change in one or more of the terms of a commercial or business debt instrument holder’s obligation or encumbrance due to some form of economic hardship currently affecting the borrower. Examples of these hardships may include, but are not limited to, reduction in the rent roll, because concessions had to be made to tenants in order to keep them viable; loss of tenants due to the current economic conditions, loss of revenue from sales.
How does a commercial loan modification differ from a residential modification?
The modification of the commercial debt is being accomplished to assist the viable business to continue to operate profitably. By alleviating some of the current debt obligation the business or investment can remain at a positive cash flow, thus affording the owner of the debt the motivation to continue to make payments to the debt instrument holder during this time of economic uncertainty.
Who qualifies for a commercial loan modification?
The viable business owner or property investor who can demonstrate current or expected economic hardship, but at the same time is able to show that s/he can meet the proposed financing/modification will qualify for a loan workout. The debt instrument holder must become very comfortable that s/he is not just delaying the obvious - foreclosure - but that the modification will benefit the borrower and s/he will be able to maintain the new debt service program established through the modification/workout. COMAC has the expertise to demonstrate how a modification will enable the business owner or property investor not to become a toxic asset on the bank’s balance sheet.
How do I know if I qualify for a commercial loan modification?
Since this process is totally subjective the only way to know if you are eligible for a modification is to have a preliminary phone call with one of our experienced workout consultants. During that call you will be asked a series of questions. Your file then will be reviewed by a Senior Associate of the firm to determine the likelihood of completing a successful modification on your behalf.
How do I go about getting a loan modification?
Once it has been determined that you are a likely candidate for a modification, we will enter into an engagement letter spelling out all of the terms and conditions for us to work together.
How long should a loan modification take?
The typical commercial loan modification should take between one and three months. The time for the modification will depend upon how rapidly we get your information and how quickly the debt instrument holder responds to us.
What is the cost for a commercial loan modification?
Unlike residential where companies are charging advance fees, we are so confident in our ability to negotiate on your behalf that we will not charge any advance fee, and we only get paid after your successful modification. The cost for the commercial modification will vary depending on the amount of savings we are able to negotiate on your behalf. Upon engagement of our company, all expected compensation will be explained to you.
Are there any licenses required to perform a commercial loan modification?
According to the Department of Real Estate, a loan modification of any sort must be performed by a licensed California Broker or an Attorney. Our company California Commercial Loan Modification Company has been licensed and approved by the DRE to assist in commercial loan modifications.
What if my property is outside of California? Can you still perform the loan modification for me?
As long as the property in question is located here in California we can most likely assist you with your commercial loan modification. We are obligated to call your local Real Estate Licensing Bureau to determine if we can legally work with you.
Should I seek legal counsel during the loan modification process?
This is entirely a personal decision. We do recommend that you discuss the final result with an Attorney before executing any new loan documents or modification documents.
Are there tax consequences to a commercial loan modification?
We recommend that you seek competent tax advice, as there could be tax consequences related to the modification of your debt. We are not tax experts and advise quite strongly that competent tax advice be obtained.