Tag Archives: mortgage maturity

Texas Independent Hotel Refinance

Ryan Dumas’ client has an independent hotel in central Texas. The owner and her late husband had been operating the hotel for a number of years. They had a private mortgage and wanted to refinance to a more traditional mortgage. Independent hotels often face some barriers in securing financing. But our GRP Capital team was able to find a lender and secure an SBA 7a loan. Ryan was particularly pleased that this SBA loan closed in under 60 days. Truly, this was proof that quick closings can still occur with an SBA product!

Ryan described the closing, saying, “I enjoyed getting to know the owner and her son. They have been working together to maintain and market this independent hotel. I wanted to do everything I could to support these small business owners. They wanted stable, guaranteed funding. The SBA loan was the perfect vehicle for them.”

Special Considerations for an Independent Hotel:

• What are the benefits for keeping this as an independent hotel? Be prepared to show how this hotel operates without the benefit of franchises. Is your location so good, that you do not need the franchise support? How is this property marketed? What are the cost savings of staying independent?

• Hotel statistics: Independent hotels have to work harder to keep track of occupancy, average daily rate and revenue per average room. Be sure that the seller (if you are buying) or you (if you are refinancing) have accurate statistics. Lenders will also often request sales tax payments to verify occupancy statistics.

• To STR or not to STR? Lots of independent properties don’t subscribe to the Smith Travel Report (STR) system. But STR reports can be very helpful as you operate your hotel. You can compare your occupancy and average daily rate to your competitors. Consider if this information would help you in setting rates and making future business plans. It may be worth the money to subscribe, even for a short time.

• Why should I consider an SBA loan?:  Small Business Administration (SBA) loans are often the best matches. For instance, the SBA is willing to guarantee a larger variety of hospitality loans, including economy and mid-scale properties. And many lenders will not consider loans to independent hotels without the SBA guaranty.

• Explore your current lender’s options: If you already have an affordable mortgage, consider why you are interested in refinancing. We can help you determine the costs and the benefits of a new loan.

Why Choose GRP Capital?

Our GRP Capital team specializes in crafting financing solutions tailored to each client’s unique goals.

Whether you’re purchasing, refinancing, or building from the ground up, our extensive network of lenders ensures you’ll find funding that aligns with your goals and cash flow needs.

Here’s what sets us apart:

  • We save you time by researching and identifying the best funding options for your project.
  • Our expertise spans various loan products—including non-recourse loans, SBA loans, bridge loans, and conventional financing—so you can navigate even the most complex transactions confidently.
  • Beyond lending, we provide strategic guidance on operational decisions that drive long-term business success.

Refinance for Carolina Maturing Note

Mortgages are not forever and a maturing note means it is time to take action right away.

Our North Carolina client owned a franchised hotel. His mortgage was maturing and had a balloon payment at the end. Previously, he had renewed his mortgage with his existing lender. However, his lender’s appetite for hospitality lending had changed. The bank leadership had already filled their quota of hospitality loans. They no longer wanted to refinance or renew his maturing note.

We have seen multiple cases of lenders not refinancing or renewing a maturing note. This can be due to the leadership directives of the financial institution, their internal industry quotas or internal risk assessment.

Ultimately, our client turned to GRP Capital to find a suitable lender, one who had room in their portfolio for a hospitality loan.

Krishan Patel, Managing Director of GRP Capital stated, “Our client was hopeful that their current lender would renew their mortgage and was distressed when that was not the case. Throughout the process of finding him a new loan, I personally kept in regular contact with the current lender. We had a good working relationship, even after the date of the note maturation passed. I regularly reassured the lender that we were in the process of securing financing. Fostering a relationship with both his current lender and the new one was critical, as it turned out that our client had a family emergency. This emergency caused a delay in closing, but one which was communicated to all stakeholders.”

Having a large lender network allowed GRP Capital to find an appropriate lender and close the loan as quickly as possible.

Planning for Your Maturing Note:

• Explore your current lender’s options: Well before your note matures, contact your current lender. Inquire if it is possible to renew or refinance and what the details of the new loan would be in terms of monthly costs and ultimate maturity details.

• Determine what is most important to you: Are you concerned about government guarantees? Are you rate-sensitive? Does your loan need to have a certain length? Each borrower has definite priorities. Decide what are your 1-3 most important components of a loan.

• Don’t delay in dealing with a maturing note: Whatever you do, start working on financing at least six months prior to maturation.

• Preserve Your Relationship with Your Current Lender: Pay your mortgage on time. If additional documents are requested like financial statements or an updated appraisal, be compliant and responsive. Ask your lender to prepare a loan history and eventually a payoff statement.

• Get your documents ready. If you are considering a refinance, gather your materials about your business operations (financial statements, business bank statements, budgets and projections). And also assemble the personal documents of any guarantors including three years of tax returns, personal financial statements and information about any other businesses of which you own 20% or more.

• Why should I consider an SBA loan?:  Small Business Administration (SBA) loans are often the best matches. For instance, the SBA is willing to guarantee a larger variety of hospitality loans, including economy and mid-scale properties.

Why Choose GRP Capital?

Our GRP Capital team specializes in crafting financing solutions tailored to each client’s unique goals.

Whether you’re purchasing, refinancing, or building from the ground up, our extensive network of lenders ensures you’ll find funding that aligns with your goals and cash flow needs.

Here’s what sets us apart:

  • We save you time by researching and identifying the best funding options for your project.
  • Our expertise spans various loan products—including non-recourse loans, SBA loans, bridge loans, and conventional financing—so you can navigate even the most complex transactions confidently.
  • Beyond lending, we provide strategic guidance on operational decisions that drive long-term business success.