Warehouse Loan Modifications - What You Can Do When Rental Income is Low

When the rental income provided by your warehouses has dropped so low that you are having trouble coming up with the mortgage payments, then it may be time for warehouse loan modifications. Banks and lenders are often agreeable to a prudent loan workout if you are able to present you case in a convincing manner. Adequate preparation and getting the services of an expert in such negotiations can enhance your chances of getting your lender to lower the interest rate or even extend the term.

And even if you are currently able to make the monthly payments, there is also the balloon payment required at the end of term. With the financial crisis, the resulting tightness in money supply and the high demand for refinancing by holders of CMBS mortgages are expected to make it extremely difficult to locate a refinance lender when the time comes. Warehouse loan modifications can also help in this kind of situation.

Lastly, if the negotiations for warehouse loan modifications fail, a commercial short sale may provide the solution, particularly if you have decided to move on to another type of business. In this kind of transaction, the lender agrees to receive the proceeds of the sale as full payment for the balance. This kind of deal is particularly helpful for situations where the value of the property has declined substantially such that it is lower than the balance. Getting the bank to agree is quite difficult yet it is possible, especially when it is demonstrated that it is the only sensible option left to avoid foreclosure.

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