AboutMike Weikle Expertise Banking Lender Liability; Insurance Coverage; Consumer Rights; Bank Fraud; Criminal: White
Collar Crime; Fair Debt Collection Practices Act; Directors and Officers Liability
Experience Commissioned National Bank Examiner 7 years; President of Two Community Banks; Division Claims Specialist for American Bankers Association Sponsored Insurance Program; Carter Member of the Bank Fraud Team of the Office of the Comptroler of the Curency "OCC" (National Banjk Examiners); Attorney previously representing FDIC and Resolution Trust Corporation as well as consumers and commercial borrowers in claims against the banking industry; Former Data Processing Systems Examiner for the OCC; Expert Witness on variety of banking issues in both state and federal court.
Education/Credentials Certified Public Accountant;
JD -- West Virginia College of Law - Order of the Coif
Data Processing Training Old Dominion Bank and IBM
Question I understand that you can finance commercial real estate acquisitions with taxable floaters if you are able to secure a direct pay letter of credit to back it up. How difficult is it to obtain a DPLOC? How long a term will the bank commit to keep it open? I am considering the purchase of a GSA leased property at 60% LTV and would like to know if this is feasible. Thank you.
Answer Yes it is feasible as DPLOC provides a credit enhancement that will lower the borrowers overall cost of debt. It is not difficult to obtain providing the project merits the issuance of a DPLOC. The terms of the DPLOC will depend again on the project. Most commercial banks will issue DPLOC provided you meet their lending requirments. The best thing would be to present your proposal to a couple of banks and see which one offers the better terms. Check out the websites of a few commercial banks in your are and see what types of LOC they reference in the website, then call a loan officer and make an appointment to discuss the project and the DPLOC.
