Great Rates, Modest Expectations for 2012

Bonds rallied last week, driving the 10 year Treasury back below 2% – down in fact to 1.92%.  This means continuously fabulous rates for those my colleague Mike Cantwell calls the conservative and capable few borrowers.  Rate wars, that’s what we have.  Life companies at mid 3’s for 5 year paper and mid 4’s for 10 year loans (60-65% LTV, stellar lease income stability, please).

Niche lenders – like our credit unions (see my rate sheet at) are providing more and more liquidity for the not-so-stellar deals – or the smaller deals – that do not fit life company strict standards.  And of course we lend to those who do not want a heavy, draconian prepay penalty.  And, oh yes, we do construction loans for new bulls or gut rehabs.  So there’s cash out there, though it lies in unexpected places. See our current rates and programs — bringing cash to the “small” commercial market – at Rate and Program Summary Centennial Lending Commercial Mortgages January 2012

OK on to politics. Is the state of the union is getting stronger, as our President would have us believe?   Not with continuously falling housing prices, 13 million Americans out of work and a 1.3 trillion deficit it is not.   As my friend WSJ writer Lou Barnes said pithily this Friday, just half a day after the President’s speech,  the Fed announced an economy in such peril that its previously unprecedented aid would extend over the horizon.

Go to and tell me what you see.  We are carrying at this hour 15.3 trillion in debt.  $48,000 for every US citizen.  $135,000 for every US taxpayer.  And that mountain is going to grow by another $$1.3 trillion this year as we SPEND more that we can possibly TAKE IN. We SPEND 4.5 trillion, we COLLECT 3.2 trillion, we are short and remain so because no one of courage is in the White House and two few occupy the House and Senate. No one wants to tackle entitlements. Reckless spending, that’s the plan.

As the great former senator Alan Simpson said last Friday to the Wall Street Journal, Obama walked away from the solution proposed by his own panel.  He is in Simpson’s words afraid to confront the deficit.  Scared, in fact.  His words, this very wise man from Wyoming, not mine    The $3.9 trillion, 10-year Simpson-Bowles plan included about $2.2 trillion in spending cuts, $673 billion in reduced interest payments and $1 trillion in tax increases.  None of which was mentioned in the State of the Union.


About Timothy E Thomas

Senior business development officer, CENNTENNIAL LENDING, metro Denver. Responsible for SBA 504 production and conventional small balance commercial lending. Centennial is a credit union service organization owned by 13 credit unions in Colorado and Wyoming. Former SBA-USDA desk manager and Registered Representative for Isaak Bond Investments, Inc., a municipal broker dealer and market maker in SBA and USDA guaranteed loans and pools; taxable and tax exempt municipal bonds and agency securities serving institutional investors for over 33 years, member SIPC, FINRA.
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