Establish the payoff and deadline
Confirm the maturity date, principal balance, extension rights, prepayment terms and any notice requirements in the existing loan documents. Obtain a payoff estimate and identify the costs and reserves a new loan would require.
Compare supported proceeds with the amount needed
Use current property financials and lender indications to estimate the new loan. Compare net proceeds with the payoff, closing costs and required reserves. Show any remaining sponsor contribution explicitly.
Evaluate the alternatives
A refinance, extension, modification, sponsor contribution, additional permitted debt or a sale may address the situation. Compare costs, cash flow, guarantees, timing and the repayment plan rather than choosing from the headline rate alone.
Start while there is time to act
Work backward from maturity, allowing for lender review, reports, documentation and potential delays. Discuss any extension with the existing lender early; it is not automatic.
Related resources
Measure the refinance gap before choosing a lender
Start with the total cash needed to close: the existing payoff, financing costs, required reserves and any planned work. Compare this with the net proceeds of a replacement loan. The difference is the cash requirement to solve, whether through the sponsor’s funds, a different financing structure or a change in the plan.
For example, an $8 million payoff plus $300,000 of costs and reserves requires $8.3 million. A $7.5 million replacement loan leaves an $800,000 gap. These are illustrative figures; the important point is to compare the full closing requirement with usable proceeds.
Work backward from the deadline
Record the maturity date and any extension notice dates, then allow time for lender review, third-party reports, documentation and unresolved property issues. Ask what must be delivered to keep an extension available. Do not assume that beginning a refinance application pauses the existing loan’s requirements.
If proceeds look insufficient, discuss the issue while there is time to compare alternatives. Current operating statements, a rent roll, a capital budget and the existing loan documents make that conversation more productive.
Discuss your property financing or explore sponsor consulting.