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03. Texas Mobile Home Community

SITUATION:

This organization owned and managed a profitable Mobile Home Community in southern Texas. Although this property had been experiencing a steady level of positive cash flow, management was facing a fast-approaching maturity date on their CMBS.

After repeated denials to secure adequate refinancing from various lenders, the owners were facing the inability to meet their balloon payment obligation and needed the loan transferred into special servicing to find a solution.

If the lender did not approve an extension of term for the mobile home community, a foreclosure was imminent and the borrower would suffer a significant, yet avoidable loss of a performing asset through a foreclosure sale.

Without a transfer into special servicing combined with persuasive communication with the Special Servicer, the property would remain in maturity default. Absent effective representation on behalf of the borrower for a mortgage extension, the lender would have moved forward with a foreclosure on the property.

WHAT WAS DONE:

The Team was retained by the Mobile Home Community's management organization to get the loan transferred into special servicing and to negotiate an extension of the loan term.

The Team was able to analyze the pertinent data, determine the best position to take, and negotiate an extension of the loan's maturity date. The Team provided an objective evaluation which enabled the clients to determine exactly what actions were necessary to bring both the lender and borrower to a mutually acceptable set of terms within a loan extension. These proactive measures allowed for a timely solution on terms that were agreeable to both parties.

A track to foreclosure and legal proceedings were avoided as a result on The Team's actions toward the workout/extension of the mortgage. The lender discarded the foreclosure track and accepted the proposal to extend the loan. The property owners were able to secure the future of their performing asset while obtaining the extra time necessary to secure adequate refinancing.

Had the Team not intervened and acted in such a swift manner, the owners of the mobile home community would have lost the property to foreclosure as a result of default maturity. The Team acted as an effective client advocate that guided the negotiations to secure an expedient extension of the loan's term.

The loan was extended for 12 months with an option to extend an additional 6 months, if needed. The owner's of the mobile home community were able to keep their asset and secured its future for long term growth potential and a steady, positive cash-flowing income stream.