Recourse vs. Non-Recourse Debt

Learn REAL ESTATE FINANCE & INVESTMENTS at realestatefina...
For COMMERCIAL LOANS, visit www.evergreen.llc
---
There are two types of debt: Recourse and Non-Recourse
Recourse means the borrower is personally liable for the entire debt amount, even if the collateral securing the loan is worth less than the loan amount.
A non-recourse loan means that the borrower is NOT personally liable, so the bank’s only security is the collateral itself.
The recourse vs. non-recourse provision really only matters in cases of foreclosure, when the lender is forced to take possession of the property and sell it to recover the amount they are owed. If the lender sells the property, but still hasn’t recovered all of the money it is owed, then the remaining amount is called a deficiency.
If the loan is a recourse loan, then the lender can sue the borrower who personally guaranteed the loan and go after their other assets in order to recover the deficiency.
If the loan is non-recourse, then the borrower cannot be sued for the deficiency, and the lender must take a loss on that amount.
Recourse loans reduce the risk for the lender, while non-recourse loans reduce the risk for the borrower.
Most loans are recourse loans, especially auto loans, credit cards and home mortgages in most states, but not all. But sometimes
Non-recourse loans typically have higher interest rates and more restrictive borrower qualifications than recourse loans because non-recourse debt is riskier for lenders.
CRE loan
investing in real estate
investment properties and commercial real estate
commercial real estate lending
commercial real estate loan
SBA commercial real estate loan
commercial real estate financing
commercial property loan
commercial building loan
real estate lending
best commercial real estate loans
commercial property lending
commercial real estate lenders near me
#commercialrealestatecoaching #commercialrealestateinvesting #realestatefinance #investing #commercialrealestate #commercialloan #commercialloans #apartmentloan #multifamilyloan #apartmentinvesting #multifamilyinvesting #stepbystep #stepbysteptutorial #diagram #example #download #freedownload #howto
OTHER QUERIES:
finance
loans
recourse
non-recourse
nonrecourse
deficiency
foreclosure
lender
borrower
yahoo finance premium
yahoo finance
personal finance

[@tommylee3934]

Impressed by this man's ability to write Deficiency from back to front

[@ShaneThompson-x7q]

The handwriting is so beautiful and done backwards

[@antinational5579]

Thank you for this video. It helped me understand the concept in the easiest way possible.

[@RealEstateFinanceAcademy]

Thanks for the comment! Happy to hear it was helpful for you! - Trevor

[@StogyWogy]

I’m sure they edit the video to be flipped

[@BrendenDiaz]

Taking a Fed Tax 2 law school course. This video cleared up my understanding. Thank you!

[@RealEstateFinanceAcademy]

Thank you for your comment! I appreciate it. - Trevor

[@MrCansitoman]

This channel is a Hidden Gem thank you!

[@RealEstateFinanceAcademy]

Thank you Joahim! - Trevor

[@BabacarJDiop]

Just awesome thank you !

[@RealEstateFinanceAcademy]

Your welcome! Glad you like it! - Trevor

[@patrickstevensonn2664]

Very helpful information. Nice explanation too. Did you write backward on the board, or the board is flip backward, how does it work?

[@Fitbudgets]

Very helpful

[@RealEstateFinanceAcademy]

Glad to hear that. Thank you!

[@qj3554]

So why would anyone do a recourse loan if they could get sued

[@RealEstateFinanceAcademy]

Good question… Typically that is the only option. It’s a “take it or leave it” offer from the lender. but again, it’s inconsequential if the borrower performs as agreed and doesn’t default on the loan. - Trevor