Deal of the Week #34 – $8.3M VTB Assignment Loan – Caledon, ON
Cameron Stephens is pleased to announce the onboarding of a new client with a creative capital solution by way of an $8.3M vendor take-back (VTB) assignment loan for newly built and sold estate homes in Caledon, ON. The hallmark of this transaction was the ability to unlock timely access to capital tied up in VTB mortgages.
THE CHALLENGE: Early Access to Equity within Tight Timeline
Scenario: The client is a developer delivering newly built homes to buyers. Due to a variety of market forces, several purchasers come to the developer asking for assistance on financial closing. In response, the developer provides VTB mortgages to allow them time to secure more permanent financing. The client’s decision, while magnanimous, leaves project proceeds trapped for another 12 months.
Fast-forward six months and the client encountered a cash flow constraint, a position that would be easily resolved with access to the VTB proceeds. The client needed a solution that provided them access to this capital and could be executed quickly.
The challenge is finding a lender who understands VTB financing and has the acuity to provide a large equity take-out.
The Cameron Stephens Advantage: Fast Underwriting and Asset Class Expertise
Cameron Stephens stepped in with a solution which leveraged the value of the outstanding VTBs, providing an $7.9M equity take-out.
VTB Assignment Loans are a more nuanced lending option, as the lender does not have a first mortgage charge on the property. Rather, security is in the form of an assignment of the first mortgage VTB. Cameron Stephens has the expertise and proven track record of administering these solutions, which has led to tens of millions of tied-up capital being provided to developers.
While more complex, these financing structures are a powerful tool that can add tremendous value.
The Solution: Tailored Financing for Unique Situations
We structured a customized financing package that met the client’s needs:
- Early access to proceeds allowing for a capital injection prior to VTB maturities.
- Expedited underwriting that met the client’s tight timelines and provided funds within four weeks.
- Enabled an equity take-out which unlocked early access to capital for the client.
This deal highlights Cameron Stephens’ ability to navigate complex market conditions, craft innovative solutions, and support clients in leveraging their existing portfolio to unlock value in a challenging lending environment.
Meet the Team Behind the Deal:
- MacKenzie McGuire, Director of Mortgage Origination, Mortgage Agent Level 1
- Ramyar Satarzadeh, Analyst, Mortgage Investments
- Daniel Leitch, CFA, VP, and Head of Syndication, Mortgage Agent Level 1
- Jisung Kim, MSc, MBA, Senior Analyst, Underwriting and Portfolio Management, Mortgage Agent Level 2
Ontario Mortgage Brokerage License # 10769 and Administrator License # 11807
