For all of you anxiously awaiting news of if you qualify for this newest type of loan, which is poised to be more popular and less risky than the typical Tennancy in Common Loan, here are some details on the product recently launched by Circle Bank:
"Circle Bank has developed a new loan product that provides separate notes and deeds of trust to each TIC owner in a TIC complex. Historically, TIC owners have only been able to obtain loans where each TIC owner is jointly and severally liable for the entire loan. Individual TIC financing (also known as “Fractional Interest Lending”) overcomes this problem.
Not everyone will be able to qualify for a fractional loan from Circle Bank. First, the loan applicant must be able to prove his or her income. Second, housing costs plus other debts cannot exceed 45 percent of a person’s income. Third, a minimum down payment of 15 percent of the purchase price is required from each buyer. And, fourth, the maximum loan is limited to 75 percent of the purchase price.
The new loan product is available for both purchases and refinances on properties with up to eight owner-occupied residential units."
The article gives no indication of how many of these loans will initially be offered. (Information courtesy of San Francisco Association of Realtors).