Capital Markets Guidance product FAQ

To create a preferred equity deal, start by clicking the create deal button and filling out the basic deal information. When you reach the loan type selection, look for "subordinate debt" rather than traditional loan types like permanent or bridge financing. Under the subordinate debt category, you'll find options for both preferred equity ("pref") and mezzanine financing. Select preferred equity and continue through the normal deal creation workflow. Note that some interface language may still reference "loan requests" even for equity deals.

Yes, Lev supports both mezzanine debt and preferred equity financing. When creating a deal, you can select "subordinate debt" as your loan type and choose between preferred and mezzanine options. You can structure this financing either as a separate deal going out to market, or combine it with senior debt using the "add capital source" feature if you want the same lender to provide both types of financing. The lender list for subordinate debt may be smaller than senior debt options, but our database is continuously expanding.

You should enter the total project cost, including soft costs, rather than just the base purchase price. This gives a more accurate picture of the full financing need and helps with debt and equity calculations in subsequent steps. Including the complete project cost upfront will provide better accuracy in your deal structure and lender matching.

You can only select one loan type per deal. However, if you're working with hybrid scenarios like construction-to-permanent loans, choose the loan type that best represents your current needs. For example, if you're doing construction-to-perm, you might select either construction or permanent based on your timeline and where you are in the project. The platform supports all loan types including permanent, bridge, refinance, construction, mezzanine, and preferred equity financing.

You can specify your loan type as construction when filling out the deal workflow. Look for the transaction type or loan type field in your deal setup and select "Construction" from the available options.

Yes, you can structure deals that combine multiple capital sources, such as a senior loan at 65-75% loan-to-cost plus additional mezzanine or preferred equity financing to reach your target leverage. The platform supports requesting both types of financing together in one package. For example, if you need to reach 80% total financing, you can structure this as a 65-70% first mortgage combined with 10-15% mezzanine debt. The mezzanine and preferred equity capabilities were added as newer features to support these more complex capital stack requirements.

Currently, Lev focuses primarily on senior debt and subordinate debt financing, including preferred equity and mezzanine programs (approximately 500-600 programs available). We're actively working on expanding equity capabilities, including family office and equity investor matching. This expansion is part of a broader platform enhancement that includes AI-powered contact enrichment and improved lender program updates, expected to roll out within the coming weeks to months.

Yes, we have approximately 700-800 lenders available for preferred equity and mezzanine financing. However, our dataset for preferred and mezzanine equity is newer and still being expanded, so we may need to do additional research to find suitable matches for your specific deal requirements. We're also working on adding broader equity functionality (including family offices and other equity sources) within the next six months, but want to ensure data quality before launching this feature.

Life insurance companies (lifecos) have very tight, conservative lending parameters and typically only consider deals that are "down the middle" - well-packaged, straightforward transactions that fit their strict criteria. This isn't due to lack of data depth, but because lifecos are highly selective and programmatic in their approach. When lifecos do appear in your lender search results, they've been pre-filtered to only show those that don't require correspondent relationships, so you can reach out to them directly.

Use the filter icon at the top of the lender list to narrow down by lender type based on your timeline needs. For quick closings like bridge loans, remove banks and life insurance companies from your search since they typically have longer processing times. Instead, focus on debt funds and hard money lenders who can generally close faster. While there isn't a specific 'days to close' filter (since timing varies based on the property and how ready the borrower is), filtering by lender type will help you focus on those most likely to meet tight timelines.

Lev's AI analyzes each lender's specific programs and transaction history to determine fit. When you click on a recommended lender's profile and view their 'Programs' section, you'll see the data we use for matching - this includes direct transaction data and program details we've collected from lenders who've joined our platform. For example, if you're seeking preferred equity, the system will identify lenders who specifically offer preferred equity programs based on their actual lending history and stated preferences, not just general deal information.

If your initial suggested lenders pass on the deal, you can expand your search by using the lender type filters. For example, if banks and credit unions all passed, you can filter to see debt funds or other non-bank lenders in the system. Click 'Add Lenders' and use the filters to select specific lender types, then hit 'Update Results' to see a different pool of potential matches. This helps you adjust your strategy based on initial market feedback.

It's generally better to start with conservative valuations and improve your loan-to-value ratio later, rather than starting optimistically and having to request higher leverage. When you have confidence in a higher property value (such as expecting a better appraisal), you can mention this potential in your initial outreach to lenders without committing to specific numbers until you have documentation in hand. Moving from a higher loan-to-value ratio (like 78%) to a lower one (like 70%) is easier for lenders to accept than the reverse scenario.

The lender data comes from three primary sources: historical transaction data pulled from public county records through third-party partnerships, live transaction data from deals currently being processed through the platform, and direct validation with lending institutions through our lender strategy team. This ensures you have access to both verified loan program details and real-time market data from billions of dollars worth of transactions.

Approximately 70-75% of deals launched through the Lev platform ultimately close. Some deals don't move forward for reasons outside of the lending process, such as appraisals coming in short, environmental concerns, acquisition deals falling through, or market conditions not meeting expectations for refinances.

Deals that do close may finish with either existing lending relationships or new relationships discovered through the platform. Both scenarios are common, and sometimes existing lenders become more competitive on terms when they know other institutions are also competing for the deal.

While the platform connects you with vetted lenders based on historical transaction data, it's important to thoroughly vet each lender's process and understand how firm their initial term sheets are to minimize potential retrades during the transaction.

Lev provides proprietary market data through the Market tab, which includes recent terms and transaction history from actual deals on the platform. This data comes from multiple sources including county records, Reonomy, CoStar, and RCA, as well as Lev's own transaction data. You can view individual lender profiles showing their last 12 months of activity, including loan types, asset classes, and geographic focus. The Recent Terms feature shows actual quotes and terms from recent platform conversations, giving you market intelligence to sound more informed in lender discussions. Lev also tracks lender interactions and deal history automatically, building a comprehensive database of notes and outcomes over time.

The lender matching system has been updated to be smarter and provide real-time filtering with match insights for each potential lender. You can use the filter tabs to select different lender types such as banks, credit unions, debt funds, CMBS lenders, and life insurance companies. By default, the system selects banks, credit unions, life insurance companies, and debt funds. The matching process typically takes 1-2 minutes after creating your deal to generate the filtered list with detailed reasoning for each match. If a lender doesn't appear in your selected filters, they may belong to a different category like CMBS (commercial mortgage-backed securities).

The Lev platform works best for deals where you want to efficiently reach multiple qualified lenders and streamline your financing process. Our system is designed to help you identify the right lenders for your specific deal parameters and manage outreach effectively. The platform is particularly valuable when you want to expand beyond your existing network while maintaining quality connections. Consider using Lev when you need comprehensive lender coverage, want to save time on manual outreach, or are looking to discover new financing relationships that match your deal criteria.

Yes, preferred equity is available in Lev. When creating a deal, select 'subordinate debt' as the loan type, and you'll see options for both preferred equity and mezzanine financing. We recognize that referring to preferred equity deals as 'loan requests' can be confusing, and we're working to improve this language throughout the platform. Please note that preferred equity is a newer offering, so our data for these deals may be less comprehensive than for traditional first mortgage loans.

The market data and terms information in Lev comes from live submissions within the Lev platform - it's proprietary data, not from external transaction sources. When you integrate your email with Lev, AI technology analyzes lender responses and term sheets to extract relevant market information. This includes contextual understanding of lender preferences, geographic restrictions, and actual terms being offered. All data is anonymized to protect privacy while still providing valuable market insights. You can access this information in the Market tab under "Recent Terms" and filter it by transaction type, asset type, lender type, and region.

Yes, Lev currently has approximately 700-800 lenders available for preferred equity and mezzanine financing. However, broader equity contacts like family offices are not yet available on the platform. We're working to expand this functionality within the next 6 months, but we want to ensure we provide high-quality, verified contacts rather than uploading thousands of unverified equity sources that could create issues for users.

When you're confident a property will appraise higher than your purchase price, it's generally recommended to lead with the higher value if you believe you can support it with a proper appraisal. This gives you a better loan-to-value ratio and potentially better rates. However, it's easier to improve your position by starting conservatively and moving to a better loan-to-value ratio than starting optimistically and having to request higher leverage later. You can mention in your outreach that you expect the property to appraise at the higher value when properly evaluated. Remember that lenders won't see the actual appraised value until you provide it to them.

After completing an action, you can navigate using the main menu options. For lender research, go to "Suggested Lenders" and clear any existing search terms to see fresh results. To view market data and recent lending terms, click on the "Directory" tab and then select "Recent Terms" to access live market intelligence. Use the filter button (funnel icon) to narrow results by market and asset class for more relevant data.

Lev provides market intelligence features that help you get a pulse on current market conditions during preliminary client discussions. You can access insights in the toolbar that shows feedback from other deals, including information about lender appetite, recent quotes, and terms. This data helps you understand who might lend on your deal and what terms to expect. However, Lev doesn't automatically update lender program data based on single insights to maintain data reliability - you should use the insights to make informed decisions about which lenders to pursue.

The market data provides proprietary information from deals sent through our platform that you can't find elsewhere. Use this data to stay informed about current market terms and rates before entering lender conversations. Many users reference this information when discussing expectations with lenders, saying things like 'I've been seeing X, Y, Z in the market - are you seeing the same thing?' This helps you sound more informed and gives you a competitive edge in negotiations, even for preliminary client discussions about potential deal terms.

The recent terms data comes from live deal submissions happening on our platform and is completely proprietary - you cannot get this information anywhere else. This shows actual terms being submitted by lenders, though not necessarily executed transactions. The broader market insights combine data from multiple sources including county records, RCA, CoStar, and other integrated databases. Since the recent terms data depends on deals launched through our platform, there may be gaps for very specific or unusual property types that haven't been recently submitted.

All market data is anonymized to protect the privacy of all parties involved. We don't reveal lender names, borrower information, or specific deal details to prevent users from bypassing the platform or undercutting relationships. If we need to reveal specific information for a challenging deal, our capital markets team first checks with the relevant lenders to ensure they're comfortable sharing the information. This protects everyone while still allowing access to valuable market intelligence when truly needed.

Recent terms data is updated in real time as new terms are submitted to the platform. The data shows anonymized timeframes (such as "less than 30 days," "30-60 days," "90+ days") to maintain privacy while still providing valuable market insights. You'll be able to see your own recent terms history based on your deals and lender transactions, but your information won't flow into the general market data pool. If you have questions about launching deals or need support with market data, you can reach out through the chat feature in the bottom right corner of your screen.

When multiple lenders independently arrive at the same lower loan amount, that's likely market consensus. The most common cause is that the property's current cash flow doesn't support the requested loan amount at today's interest rates and DSCR requirements.

Most perm lenders require a DSCR of 1.20x–1.35x. If the property's NOI doesn't produce enough coverage at your requested loan amount, lenders will reduce their offer to a number that does pencil. You may want to consider a bridge loan if there is a clear pass to a higher NOI (e.g. lease-up, MTM) . A bridge lender may underwrite to projected stabilized cash flow and provide a higher loan today with a refinance exit later.

It depends on the loan type and property profile, but at the high end of that range you should expect a smaller lender pool and more friction.

For permanent loans, most banks and credit unions target sub 70% LTV. Above 70% is possible but narrows the pool significantly.

For bridge loans, 70–75% LTC is the realistic ceiling in today's market for most deals. Some debt funds advertise up to 80% LTC, but that is generally above the sweetspot.
For construction loans, 80% LTC is effectively unavailable at current market rates. Most lenders are at 60–75% LTC for construction.

If you're not getting the leverage you need, the honest market signal is that lenders want more equity in the deal. Adjusting your request, or finding an equity partner to bridge the gap, is often the more practical path than continuing to search for a lender willing to stretch.

Non-recourse financing significantly limits your lender pool. Banks and credit unions almost universally require recourse, it's a standard condition of their commercial lending programs, not a negotiating point.

Non-recourse options come primarily from:
• Debt funds: the main source of non-recourse senior debt for bridge and light bridge deals
• CMBS lenders: non-recourse is standard for CMBS execution
• Agency lenders (Fannie/Freddie): non-recourse on stabilized multifamily
• Hard money lenders: sometimes non-recourse, but terms are expensive

The key distinction is whether you are financing vertical construction (building a structure) or horizontal work / land (site development, lot preparation, entitlements). Choose Construction when the financing is primarily for vertical construction, and select the finished Asset Type. Choose Land when financing land acquisition, horizontal construction, lot development, or entitlements/permitting. If financing both horizontal and vertical, generally choose Land and the applicable land subtype. If acquiring land and immediately breaking ground, choose Construction. For SFR/townhome subdivisions, if the financing need is the horizontal lot development, use Land > Lot Development; misclassifying as Construction leads to irrelevant lender matches.

Set up as: Transaction type = Acquisition; Loan type = Land; Asset type = Entitled Land; Land type = Lot Development (for SFR lot creation) or Predevelopment (if not SFR). Even if financing includes acquisition + horizontal work, it is still classified as an acquisition and won't limit lender matches.

Illustrative examples only: Land examples include Predevelopment (entitlements/horizontal work before shovel-ready), Lot Development (horizontal subdivision work to create finished lots), and Land Banking (borrowing against raw land held passively). Construction examples include deals where vertical building is the primary purpose (e.g., MF, hospitality, medical office). If unclear, pick the closest bucket.

Predevelopment = entitlements/permitting/horizontal work needed before shovel-ready. Lot Development = financing horizontal work to create individual SFR/townhome lots (grading, roads, utilities), regardless of whether lots are sold or built on by the sponsor. Land Banking = borrowing against raw land with no active development plan. If unsure, use timeline/end goal: active work implies Predevelopment/Lot Development; passive holding implies Land Banking.

Use Land - Predevelopment, not bridge-acquisition. Bridge-acquisition for a data center land play confuses lenders because the property isn't yet a data center.

Include hard costs, soft costs, and other development costs in Project Costs. Enter land costs separately in the Land Cost field. Keeping land separate ensures accurate total cost basis and LTC calculations for matching.

Loan Amount should reflect the total requested commitment inclusive of any future funding. For construction, include initial advance + all future draws. For permanent (edge case) with future funding/holdbacks, include those dollars in the total request as well. If LTC looks off, confirm Loan Amount reflects full commitment and that project vs. land costs are entered in the correct fields.

If the property is not stabilized and not generating income, use bridge. Permanent loans are for stabilized, income-producing properties. If there's no income and work is still needed (renovations/lease-up/etc.), it's bridge; if stabilized with tenants and consistent income, it's permanent. Small check sizes often fit local banks/credit unions.

LifeCos offer best rates but are selective: top-tier sponsors, high-quality real estate, low leverage, strong markets/collateral, stabilized assets, and typically deal sizes above ~$10M. They often work via correspondent brokers and may not engage unknown borrowers/brokers. Improve response by relationship-building outreach first, calls/follow-ups, strong deal packages (Lev Memo), and long-term relationship development.

Second lien requests aren't supported for matching; Lev can't filter for second lien lenders, so results won't be useful. Mezz is supported, but checks under $1M usually have limited lender pools. Workaround: run as a senior loan at the full capital stack amount to match lenders for the asset type, then specify second lien/mezz details in outreach.

Use "Input Loan Request Amount" for the simplest setup. If using Total Capitalization, pref equity is total capitalization minus first mortgage amount; changing either changes pref amount. Ensure request type is Pref Equity (not First Mortgage) and verify total stack matches deal parameters. If numbers look off, start over using the loan request amount workflow.

In the Market tab, filter Recent Terms by loan type. Select Heavy Bridge and/or Light Bridge to see recent term data.

Enter it as a construction deal when setting up the deal in Lev. Then, in your outreach email to lenders, call out that it is actually a construction-to-perm so they can evaluate both the construction loan and the permanent take-out together.

The X mark on max LTV indicates that your deal's loan-to-value ratio might be higher than what these lenders have historically funded. However, this shouldn't prevent you from reaching out to these lenders. LTV requirements can vary significantly based on the overall strength of your deal, and these lenders may still be a great fit for your project. We recommend treating this as general guidance rather than a hard restriction and still consider sending your deal to these lenders.