Non-Recourse Loans
A non-recourse loan limits the lender to collateral only; no deficiency judgment. 60-70% of commercial RE loans are nonrecourse. Types: CMBS, life company, agency (Fannie/Freddie), HUD/FHA. Requires strong property fundamentals, experienced sponsor, 1.25x+ DSCR, 60-75% LTV, and SPE borrower.
Recourse vs. Non-Recourse
- Recourse: lender can pursue personal assets
- Non-recourse: limited to collateral property
- FL residential: typically recourse
Available Types
- CMBS, life company, agency, HUD/FHA
- Less available under $-2M, non-stabilized
Qualification
- Stable income, low vacancy, good condition
- Experienced sponsor, DSCR 1.25x+
- LTV 60-75%, SPE borrower
Related Terms
- Mortgage — Property security
Barnes Walker Real Estate
Barnes Walker’s attorneys structure non-recourse financing for Florida commercial properties. Request a legal inquiry for assistance.
Reviewed by the attorneys at Barnes Walker, Goethe, Shea & Robinson, PLLC