Today’s question comes from Gonzalo in NYC
First I’d like to thank you for all your insight and knowledge you share on your podcast and in your book. It’s both informative and inspiring.
I exited a bridge loan 2 years ago in the middle of the pandemic. Because of the pandemic, one of the banks requirements was to hold a cash reserve of $110k. I agreed with the understanding that the funds would be released after 12 months or once the pandemic was over. Although there hasn’t been any late or missed payments the bank requested to see income/expense report for the last 3 months. I shared the info with them which included several of the units being on Airbnb. I have abided NYC rent guidelines and have been doing 30 day minimum ONLY. The bank now refuses to release the funds stating that I am in default because I am Airbnb’in.
I was totally unaware of how the Bank would scrutinize my loan. Ideally I would like to continue to use Airbnb as it yields higher income.
Some useful facts
- 16 unit rent stabilized building
- 10 year fixed rate
- Prepayment penalty on the loan
Can you offer any advice on what course of action would be best to take! Thank you in advance for your help.
Host: Victor Menasce