Non Recourse Loans

Non Recourse Loans

A Non Recourse Loan, or non-recourse debt is a secured loan (debt) that is secured by a pledge of collateral, typically real property, but for which the borrower is not personally liable. If the borrower defaults, the lender/issuer can seize the collateral, but the lender’s recovery is limited to the collateral. If the property is insufficient to cover the outstanding loan balance (for example, if real estate prices have dropped), the lender is simply out the difference. Thus, non-recourse debt is typically limited to 80% or 90% loan-to-value ratios, so that the property itself provides “overcollateralization” of the loan.

A lender of non-recourse debt depends crucially on an accurate assessment of the credit of the borrower, and a sound knowledge of the underlying technical domain as well as financial modeling skills.

Follow Commercial Property Solution

Licensing

Kris Savard
Managing Partner

Equal Housing Lender

Contact Us

Commercial Property Solution
408 Sutton Place

Abingdon, MD 21009
NMLS: 244436

Number:
(888) 834-9354

Hours:
MON-FRI 7AM - 4PM