You should know how much the cost of capital will cost you no matter what type of financing you’re applying for.

Let’s take a look at a cost example.

Example of a Cannabis Real Estate / Asset Backed Loan / Cannabis Collateral Loan

Let’s say you have a commercial property that you operate your cannabis business out of, that is worth approximately $1.1 Million.

In most cases, the lender will require you to get an appraisal done to determine the value of your property.  

Lets say the properties appraised value was determined to be $1 Million.  In this scenario, Upwise will be able to lend 80% LTV based on the appraised value of the property.  Meaning the loan size will be $800k based on the appraised value on the asset.  However, we also lend based on cannabis value, which could be much higher than $1 Million.

The term length will determine the monthly payment and amortization schedule.  Payments can be interest only, principle and interest, deferred, and an interest reserve may be required.

Consider other fees associated with asset based loans as well.  These fees include but may not be limited to appraisal fees, site survey fees, legal fees, escrow fees, origination fees, packaging fees, prepayment fees, and others.

Don’t overlook fees on your loan offer—be sure to factor any and all small fees you might have to pay in order to understand the true cost of your asset based loan.

In order to understand your loan completely, make sure to ask Upwise for an amortization schedule.  All fees associated with the proposal will be transparently laid out for each borrower in a term sheet.  For more information, please call (646) 837-5522 to speak with an Upwise Real Estate Financing Specialist.