What is Modern Funding?
Modern Funding, LLC is a financial technology firm specializing in small balance commercial real estate loans. We are committed to improving the borrowing experience by combining innovative technology with seasoned real estate lending experts to arrange the best rates and terms for our borrowers.
What types of loans do you offer?
We arrange permanent, fixed and floating rate loans to purchase and refinance all commercial property. We also arrange shorter term commercial bridge loans typically used to finance substantial property renovations, and private money loans for the most opportunistic projects.
What types of properties do you lend on?
We arrange loans on all types of investment property including owner-occupied and investor-owned commercial properties, including apartments buildings. We do not lend on owner-occupied single family residential housing, land or ground-up construction projects and we do not work with borrowers who are seeking consumer financing for personal, family or household purposes.
What interest rates do you charge?
Our goal is to provide the best interest rates possible for each transaction. Lenders will consider the loan to value (LTV) ratio, the property’s operating performance and local market dynamics to offer you the best rate. To see what rates you qualify for, submit the loan request form.
Are there any fees for borrowers?
There is no fee to request a loan quote. At loan closing we charge an origination fee and standard closing costs, all of which are disclosed in your application.
How is Modern Funding different from a bank?
We don’t have any branches or bureaucracy and won’t try to sell you any other financial services because all we do is arrange commercial real estate loans. While Modern Funding arranges loans similar to banks and other financial institutions, our online systems and technology are designed to accelerate the process while simplifying the borrowing experience.
Is Modern Funding a mortgage broker?
Think of us as your technology-enabled personal loan advocate. While we perform many of the roles of a typical mortgage broker, we are able to serve you better because we are not limited to a defined group of lenders. Our technology has enabled us to cut costs from the traditional loan origination process which enables us to pass the savings along to you.
Is the Modern Funding website secure?
Yes. We go to great lengths to ensure the security of all customer data. We utilize 256-bit SSL (Secure Sockets Layer) to establish an encrypted link between our server and your browser session. This link ensures that all data passed between server and browser remains private and secure. You will know your browser session is secure when you see a locked padlock icon in your browser.
How do I apply for a loan?
Use the Genarater. It takes about a minute to produce an estimated interest rate and payment amount for your proposed transaction.
What happens after I submit my loan request through the Genarater?
You will be prompted to either 1.) Save your quote, or 2.) Get your loan, which prompts one of our loan specialists to review your loan request and contact you with any additional information requirements. There is no cost in either scenario and neither action will affect your personal credit score.
How much can I borrow?
We focus on loans starting at $500,000 secured by commercial real estate.
How long does it take to close a loan?
We are committed to closing your loan as quickly as possible, typically between 30 to 60 days from receipt of your loan request.
Who will fund my loan?
Your loan will be funded by a lender in our network that includes banks, private lenders, CMBS conduits, real estate funds and other non-bank lenders.
Brokers, REALTORS®, Sales Agents
Do you work with real estate brokers, agents and REALTORS®?
Yes, we work extensively with brokers and are always looking for new relationships. We have referral programs that enable brokers to earn meaningful compensation.
I’m a REALTOR® – Why Should I Refer My Clients to Modern Funding ?
Read this article in our Resource Center.
What is the Genarater?
The Genarater is the industry’s first online loan quote app for small balance commercial real estate loans. Genarater evaluates actual property and borrower inputs together with requested loan parameters and produces an estimated interest rate quote and payment specific to your loan.
What is a bridge loan and how do I know if I need one?
A commercial real estate bridge loan is a short-term, floating-rate loan secured by a first mortgage lien on investment property. Projects financed are typically in some state of transition due to significant renovation, recapitalization or re-tenanting, or all three.
What is a private loan?
Private loans are provided by small, entrepreneurial lenders, sometimes referred to as “hard-money” lenders. Because these lenders will make riskier loans secured by properties that may need significant renovation, these loans can be expensive and typically require a financial guarantee from the borrower. Private lenders can make very fast credit decisions and will typically ignore borrower-related credit issues, focusing solely on the value of the property to secure the loan.
What is a traditional loan?
Traditional loans for small balance properties are provided by banks, CMBS lenders, life insurance companies and government agencies (for apartments only). These lenders typically finance stabilized properties in primary and secondary markets owned by experienced, well-capitalized borrowers. Borrower guarantees may not be required, and loan amounts are limited to 70% to 75% of property value. Because these loans are reserved for the best properties in the best markets, rates are typically very competitive as many lenders compete for the business.
What is a high-LTV loan?
As the name implies, high LTV loans are loans where the loan-to-value (LTV) ratio exceeds 75%. Maximum LTV is typically 85%. Lenders are typically entrepreneurial funds or private equity managers who are comfortable taking additional credit risk in exchange for recourse or other favorable (to the lender) structural elements.
Tips & Tricks
Should I refinance now?
Good question. Read this blog post.
Will I have to pay a penalty if I refinance my current loan before its maturity date?
That depends. Many CRE loans are open to early prepayment during the six months prior to maturity, without penalty. Other loans carry prepayment penalties that can be difficult to understand. Our loan specialists can help you understand whether a refinance makes sense in today’s environment, either with or without paying a penalty to your existing lender.
I run a business and don’t have time to gather all the documents required to get a loan. Can you help?
Yes! That is our job. We will be your guide throughout the complex and time- consuming process of financing commercial real estate. We specialize in matching entrepreneurs, investors and small business owners with the loan products and lenders that best meet their specific financing objectives.
How do I choose a lender?
The best lender for a given property will depend upon the borrowers’ tolerance for recourse, interest rate risk and term. Attitudes toward commercial real estate by lenders can change over time and it is wise to maintain multiple lender relationships so you are not beholden to the whims of any one lender or type of lender.
How do I know what type of loan is best for me?
Use the Loan Wizard. After responding to eight questions, the Loan Wizard will suggest a loan type that is best suited to your transaction. Continue directly from the Loan Wizard into the Genarater to produce an estimated interest rate and payment amount.
What is better, a fixed rate loan or a floating rate loan?
It depends on several factors. If you can lock in a fixed-rate loan in a low-rate environment and intend to own the property for the term of the loan – do it! Alternatively, adjustable rate loans may be less expensive today, but are subject to fluctuations in interest rates, which may increase your monthly payments.
I have a small real estate portfolio of income properties I would like to finance. Can you help?
Yes, we work with lenders who will fund loans secured by multiple cross-collateralized, cross-defaulted income-properties. Contact a lending specialist for more information.
I am about to buy my first investment property and have never applied for a commercial real estate loan before. Can you help?
Yes. Getting a commercial real estate loan can be a fairly complicated and time consuming process. To get the financing that is best for you, you should speak to several lenders and make them compete for your business. If your transaction is time sensitive, it is best to work with an advisor who can make sure you get the loan you need to close your transaction. Start with the Genarater. It takes about a minute to produce an estimated interest rate and payment amount for your proposed transaction.