Commercial Lending

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Non-Recourse Financing Options For Commercial Real Estate

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A non-recourse loan is a mortgage agreement where the collateral securing a loan is the sole source of repayment.  The lender can’t hold the borrower or guarantors liable in the event of a default. The lender can seize and sell the property, but can’t seize non-pledged property or assets from the borrower.This type of financing is typically found on longer term permanent commercial real estate loans placed on a stabilized and performing asset. Read more


If you are considering adding commercial real estate to your portfolio, there are many decisions that go into determining the best financing options to maximize your investment. A non-recourse loan may be the best loan structure to meet your goals.  The main benefit of non-recourse financing is the elimination of personal liability. Here are a few more pros and cons:

Some Pros and Cons for Non-Recourse Commercial Loans

Pros

Cons

No personal liability (except bad boy carve-out)

   Defeasance or yield maintenance

Longer amortizations & terms

Higher costs to close

Assumable to a new owner

Reserves for TI & LC

High LTV

Limited to certain commercial lenders

Certainty of closing

Escrow and impound accounts for taxes & insurance


At the Madison Group, we offer a wide range of commercial real estate financing options for investor and owner-user properties nationwide. Non-recourse loans are available in most states. Our in-house experts can determine if non-recourse is right for you and help you to secure the best rates and terms to meet your financing goals.  

Non-recourse commercial real estate loans can be used for commercial investments such as shopping centers, medical offices, office buildings, retail centers, industrial and warehouse, self storage, multi-family, and flagged hotels, to name a few. They may be used for acquisition or refinancing of a commercial real estate.

The Madison Group is partnered with a diverse group of lenders including commercial banks, life insurance companies, CMBS and local banks. Our strong relationships with these lenders enable us to maintain a healthy variety of products and terms. Talk to us today about the non-recourse lending product that is right for your real estate needs.  Whether you are looking into financing a multi-family property or a commercial building, The Madison Group can provide solutions.

General Non-Recourse Lending Parameters

Limits

$1,000,000 minimum

Rates

Competitive spreads over the 5-year and 10-year swap

Terms

5, 10, 15 and 30-year rate terms 

Amortization

25 to 35-year amortization 

Recourse

Non-recourse (subject to standard carve-outs)

DSC Range

1.03 to 1.35 with a 1.20 DSC on average

LTV Limits

80% LTV/LTC maximum – 85% with mezzanine financing

Debt Yield

7% Debt Yield – depending upon quality of the asset

Property types

Apartments & Mobile Home Parks (Multi-family properties), Retail, Office, Industrial, Self-Storage, Hospitality, Industrial, Single Tenant, Credit Tenant

Geographic areas

Nationwide

Non-Recourse Loan Closings and News

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The Madison Group Arranges
$1,767,000 for Apartment
Refinance in Utah Read More

The Madison Group Arranges
$4,500,000 Non-recourse Loan
for an Industrial Building in
Wisconsin Read More

$4,600,000 Purchase
Financing for a Credit Tenant
Property Read More

The Madison Group facilitates
a $3MM refinance of regional
grocery Read More

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Contact Us

The Madison Group

520C North Main Street, #201
Heber City, Utah 84032

Phone: (435) 785-8350

Web: www.madisongroupfunding.com

The Madison Group of Timberlakes, Inc. is a BBB Accredited Mortgage Broker in Heber City, UT yelp icon

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