Conventional Loans
CapitalSource Small Business Lending's conventional product provides straight-forward commercial loans to qualifying businesses for purchase, refinance, construction, expansion, recapitalization and business buy-out. CapitalSource Small Business Lending conventional loans are versatile and fast to close.
Loan Purpose
- Purchase commercial real estate, purchase machinery, equipment, fixtures and furniture, working capital, inventory, refinance debt, cash-out debt refinance.
Loan Amount
- Up to $4,000,000.
Time to Close
- Commitment letter typically within 3 days of completed application!
- Closing within 45–60 days of signed commitment letter.
Loan To Value
- Up to 75%.
Interest Rate
- Based on a spread over the 30 day LIBOR rate, adjusted monthly.
Term
- Up to 25 years, fully amortizing over the life of the loan. No balloons.
Prepayment Penalty
- No prepayments allowed the first year of the loan. Prepayments will be assessed a minimum penalty of 5%, 4%, 3%, 2% and 1% of the loan balance in years two through six.
Fees
- Origination fee.
- Good faith deposit to be used for loan closing costs.
Collateral
- The loan must be fully secured by commercial real estate or a combination of commercial and residential real estate.
Recourse
- The loan must be guaranteed by at least one principal who owns 20% or more of the borrowing entity.
- The guarantee of affiliated companies may be required based on the percentage of ownership of the affiliate and the borrower's relationship with the affiliate.
Debt Service Requirements
- A minimum projected debt service coverage ratio of 1.25 times is required.
Industries
- Loans can be made to for-profit businesses except those involved in nuclear waste, utilities, natural resource development, fishing vessels, biotechnology and internet technology.
Other Considerations
- Appraisal and Environmental reports will be required for real estate used as collateral.
- Borrowers cannot have filed for bankruptcy within the last three years.
- Payment reserves are generally required.
- Life insurance of up to 50% of the loan amount will generally be required.
