What Will It Take For Lenders To Lend Again?
As everyone knows, the commercial real estate capital markets have been in turmoil since June of 2007, when the single family subprime lending debacle first appeared on the scene. Since that time, the lending market has slowly, but ever so consistently continued to deteriorate.
I am frequently asked “When will the lenders start lending again?”. While there is no silver bullet listed below are several things that need to happen.
- The overall economy needs to improve
- Commercial real estate fundamentals need to stabilize
- Foreclosures need to occur so banks can cleanse their balance sheets of non-performing assets
- Weaker banks need to fail
- Lenders need to extend, amend and pretend
- Inflations needs to happen
- A new version of the Commercial Mortgage Backed Securities (CMBS) needs to be created
All of the solutions will take time to favorably impact the market. Even if all seven factors were to begin moving in the right direction today, it would take months before the lending environment would fully feel this positive influence.
To find out more details or discuss these points feel free to give me a call me Bob Nelson at (541) 485-8100. I have a complete report that I can share with you.
This article is reproduced with the permission of Doug Marshall of Marshall Commercial Funding.
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