Frequently Asked Questions
How long will the process take?
Sphynx Financial is dedicated to providing you with quick funding to meet your loan requirements. Assuming that you have provided the necessary key documents needed to underwrite the loan, we typically are able to close loans within 30-45 days.
What differentiates a commercial mortgage from a residential mortgage?
A residential mortgage is limited to as the name implies, “residential properties” no greater than four units per building, whereas, a commercial mortgage is utilized to secure financing for a wide-array of property types. In addition, the residential loan process is essentially standardized through the use of guidelines established by Freddie Mac and Fannie Mae, while the commercial loan process can vary greatly from lender-to-lender.
What type of information will I need to provide to Sphynx Financial to ensure that the loan process runs smoothly and efficiently?
Depending on the type of loan Full Doc/Stated, each loan will have the following standard documentation requirements:
In what states does Sphynx Financial do business?
Sphynx Financial has the ability to finance deals in all 50 states.
How much equity does one need in order to be approved for a commercial mortgage?
Every commercial lender requires that the applicant have minimum 10% equity in the property. This translates into a Loan-to-Value (LTV) that is no higher than 90%. There are exceptions to this rule when two separate properties can be cross-collateralized.
What type of properties do you loan on?
Property types including: Retail, Mixed-use, Multi-family 5+ units, Hotels & Motels, Retail, Auto Repair / Auto Body, Bars/Restaurants, Dry Cleaners, Strip Malls, Office Buildings, student housing, warehouse/storage, mobile home parks, light industrial & many more.
Does Sphynx Financial have Full Doc or Stated Income programs?
Sphynx Financial provides financing with Full Doc and stated income programs. Better rates are available for full doc loan requests.
What are Sphynx Financial’s credit score requirements?
Underwriting includes review of the borrower's history in repaying other debts. Credit scores are therefore an integral part of our programs. Higher credit scores allow better rates and/or higher loan-to-value ratios while lower scores may impact the borrower's ability to obtain financing. We prefer scores above 660 but will review requests with lower scores (minimum 600).
What are Sphynx Financial’s minimum and maximum loan amounts?
Commercial real estate loans from $250,000 to $500,000,000.
What loan types does Sphynx Financial offer?
Sphynx Financial offers fully-amortizing loans, as well as, several term options. Loans are typically 5-year Fixed, 10-year Fixed or Fixed for Life (up to 30 years).
Interest Only and Variable Rates are available upon request. Sphynx Financial also maintains relationships with private equity, hard money, trusts and hedge fund investors for more creative financing options.
Does Sphynx Financial do blanket mortgages?
We prefer to finance each property separately; however, we will consider blanket mortgages on a case-by-case basis. We do not cross-collateralize with residential property and we do not collateralize with primary residences.
What property types does Sphynx Financial fund?
We fund most commercial property types including multi-use (office, retail, industrial, warehouse), multifamily (minimum 5 units), special-use and hospitality.
Does Sphynx Financial offer loans to foreign nationals?
Yes. Sphynx Financial will lend to foreign nationals on stronger loan transactions. We typically require the foreign national to demonstrate they have other assets in the US (such as investment properties or a home).
Rate Sheet - Where do I find Sphynx Financial’s rate sheet?
Our Rate Sheets are available for industry professionals. To begin receiving Our Rate Sheets, register now by clicking on the following link.
Does the Pre-Approval include all the loan terms and estimated costs?
Yes. The Pre-Approval provides details of the transaction, including the loan terms and estimated costs.
Will Sphynx Financial accept an existing appraisal?
Existing appraisals are generally not accepted due to their age or scope of the report (such as being prepared for the borrower instead of a lender). If the appraisal was completed within the last six months, the report should be submitted for our review. We try to keep borrower costs to a minimum and we generally will accept a current appraisal of good quality.
Is the appraisal fee refundable if the value isn’t there?
No, the fee is not refundable as the report is performed by a third party. If the value isn’t there, Sphynx Financial will determine what options are available to make the deal work.
How does the appraisal process work?
After we receive the required Expense Deposit for third party reports, we will engage the appraiser. The appraisal generally takes 3 to 4 weeks to complete their report. The loan should close within 10 business days thereafter.
Can I engage my own appraiser?
No. All 3rd Party Reports, including the appraisal, must be engaged by Sphynx Financial in conjunction with our requirements. Sphynx Financial has a preference for national firms and has found that even though an appraisal prepared by smaller operators may cost less, the quality of the report may present problems that interfere with the ability to close the loan. Issues we have experienced with smaller operators include excessive use of Extraordinary Assumptions, lack of supporting information provided for appraiser’s assumption, excessive adjustments to comparables and lack of market information.
If you have an appraiser that would like to be approved for use in our lending programs, please have them contact us. We will request information from the appraiser to determine if they meet our experience and reporting requirements.
Do you require an MAI appraiser?
An MAI is preferred, but not necessarily required. We will also take into consideration the appraiser’s experience and quality of their reports.
Can I get my own appraisal bid?
We are required to contact our own appraisers for bids as the cost is related to the job requirements and type of report needed.
Will the borrower receive a copy of the appraisal report?
Yes. Copies of all the third-party reports, including the appraisal report, will be provided to the borrower at the time of closing or shortly thereafter.
Who orders the title policy?
Sphynx Financial prefers to order title because it enables us to manage the deal and keep the process moving. We have relationships with title companies who understand the endorsements we require and are responsive to our needs.
What if the title is already in process?
We will work with you to help ensure there are no problems.
What is an attorney state?
The states of Connecticut, Delaware, Georgia, Massachusetts, South Carolina and West Virginia are considered attorney states as closings are conducted by attorneys rather than title companies. Additional document fees and/or attorney retainer fees may apply in attorney states.
Does Sphynx Financial require automatic payments?
Generally, not. Loans with credit issues, however, may require ACH automatic payment.
Does Sphynx Financial require an environmental report?
We typically require a Phase 1 environmental report but the requirement varies by loan program and transaction type. In some cases, we are able to use a less expensive report, such as a Transaction
Do all loans require a personal guaranty?
Personal guaranty is preferred, but we may consider limited or non-recourse on a case-by-case basis for stronger quality loans and properties.
Who will have to sign on the loan?
Any Operating Company (OC) and/or Eligible Passive Company (EPC) involved in the transaction will be required to provide its authorized signature. Most of our loan programs require full recourse to the principals (defined as owning a minimum of 15-20%). In cases where there is a minority partner providing the majority of capital for the project, the minority partner may be required to provide their guaranty too. We may consider on a case-by-case basis a non-recourse or limited recourse request for stronger loan requests with lower loan-to-value ratios. The principal’s financial and credit information would still be required for review on a non-recourse or limited recourse request.
What is an OC?
The OC is the Operating Company, which is a business owned by the borrower that will occupy the property.
Do you have additional questions?