Debt Financing

Debt financing for real estate

A real estate loan is the one contract that can reach past your LLC and take what the entity was built to protect. Nonrecourse does not mean what most borrowers think it means. A personal guarantee waives the shield by contract, for that debt, no matter how clean the LLC is. And the loan documents quietly outrank the operating agreement you spent months negotiating.

This pillar reads real estate debt from the borrower's side and the entity's: who lends, against what property, on what terms, papered in what documents, and where the loan and the LLC collide. It is the seam most advisors do not cross, because the banker does not read your operating agreement and your lawyer does not read your loan. You are the only one holding both. Equity raising, the other half of the capital stack, lives in syndication.

The terms of the loan are where the money and the risk actually live, so that is where this pillar starts.

TermsRate, amortization, coverage tests, recourse, covenants, and prepayment: the dials that decide whether a deal survives to payoff. The personal guaranteeThe one document that reaches past the LLC to you: what it waives, whether the lender comes for you first, and what survives the company. The seamsWhere the loan and the LLC collide: due-on-sale on transfer, the Article 8 opt-in versus charging orders, and the covenants that outrank your operating agreement. Red flagsThe clauses built to strip your ability to fight: confessions of judgment, portfolio-wide cross-default, merchant cash advances, and all-asset liens. Loan documentsThe closing stack is separate contracts, not one loan: the note and the lien, the environmental indemnity that outlives everything, the assignment of rents, the authority package.

This is all free.

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If you need help with your specific situation, you don't have to figure out who to call. Start with me. I'll understand what you need, and with my gigantic Rolodex, I can put you in touch with the right specialist for you.

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