FREQUENTLY ASKED QUESTIONS

The Detailed Version

 

How much is your fee?

Our origination fee is 1.00% of the loan amount. Of this fee, a fully-refundable deposit of $1,000 is paid to us if you sign an application with one of our lenders. The remaining balance of the origination fee is paid at closing. Please note that our minimum fee is $12,500.


EXAMPLE  1

We close a $1,700,000 loan for you. Therefore, your total fee is $17,000. Of this $17,000, $1,000 is deposited at Application. The remaining balance ($16,000) is due at Closing.

EXAMPLE  2

After packaging your loan, we do not find an acceptable lender for you. Consequently, your loan never goes under Application. Your fee is $0.


What is the total closing cost for my loan?

We use many lenders so closing costs can vary widely. Costs for closing a CRE mortgage is a function of the loan amount. A general rule of thumb is 2.00% of the total loan amount. The larger the loan, the lower the closing costs as a percentage to the transaction. Our total closing cost estimate pays for the following:

  •   Property Appraisal

  •   PCA Report

  •   Phase I Report


  •   Title Insurance

  •   Insurance Review

  •   Land Survey


  •   Attorney Fees

  •   Lender Processing Fee

  •   RSR Origination Fee

EXAMPLE  1

We estimate a $4,000,000 loan would cost $69,000 in closing costs, or roughly 1.75% of the loan. Again, legal fees and lender processing fees vary, so this is an estimate.

RSR Origination Fee

Lender Fee

Property Appraisal

PCA Report

Phase I Report

Land Survey

Title Endorsements

Lender Legal Fees

Total Estimate

$40,000

$5,000

$4,000

$3,000

$3,000

$3,500

$3,000

$7,500

$69,000

EXAMPLE  2

We estimate a $2,000,000 loan would cost $46,500 in closing costs, or roughly 2.33% of the loan. Again, legal fees and lender processing fees vary, so this is an estimate.

RSR Origination Fee

Lender Fee

Property Appraisal

PCA Report

Phase I Report

Land Survey

Title Endorsements

Lender Legal Fees

Total Estimate

$20,000

$2,500

$4,000

$3,000

$3,000

$3,500

$3,000

$7,500

$46,500

EXAMPLE  3

We estimate a $5,500,000 loan would cost $84,000 in closing costs, or roughly 1.53% of the loan. Again, legal fees and lender processing fees vary, so this is an estimate.

RSR Origination Fee

Lender Fee

Property Appraisal

PCA Report

Phase I Report

Land Survey

Title Endorsements

Lender Legal Fees

Total Estimate

$55,000

$5,000

$4,000

$3,000

$3,000

$3,500

$3,000

$7,500

$84,000

Why should I work with RiverStone RECAP?

Our fee absorbs the cost of originating loans for lenders. In return, lenders will waive or reduce additional origination fees. Also, because of our lending relationships, we are also able to negotiate better loan terms with lending sources. Therefore, borrowers would incur no additional costs by engaging us to represent their loan.


EXAMPLE  1

We find you a self-amortizing 25-year loan for $2,000,000. If we are able to negotiate your interest rate from 5.00% to 4.875%, the owner would save $43,558 in interest payments over the life of the loan. The total fees paid to RSR would be $20,000. Therefore, the owner would save a total of $24,558 by having us represent them.


Could you tell me more about your fee?

Sure. Our fee covers the cost of material, time and effort put into finding your ideal loan. After initial conversations, we put together a loan package on your property, send it out to lenders and negotiate on your behalf for the best deal. We then help you through the application and loan commitment process. We are with you every step of the way until the loan closes.


NOTE

Be wary of firms that do not disclose all fees upfront. Some charge additional fees along the way and don’t tell you until it is time to pay. This could include loan packaging fees, additional processing fees or even a yield spread premium.