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Commercial Mortgage Bridge Loans

By Terry Savage on May 30, 2015 | Investments

Financial Planner Jordan Goodman was recently on WGN’s Steve Cochran’s radio show touting the benefits of commercial mortgage bridge loans. What are your general thoughts regarding this type of investment, and more specifically, the associated risks?

Thanks for your input.

Terry Says:  I’ve answered this question before, and I will say the same thing again.  I have the utmost respect for Jordan Goodman, and I’ve known him for many years. But on this investment we happen to disagree.   Any investment with a yield of 6 percent, by definition implies more risk.  (Home mortgages today yield only about 4% — and we know how risky they can be in bad times!)

Commercial bridge loans are tough to get from banks — despite the fact that banks have tons of money these days and are looking for good loan investments.  So if a commercial firm doesn’t have either the good credit, or track record, or financial strength to borrow from a bank — then why should YOU take the risk??  That’s my objection on financial principle.  This is the kind of risk that works — until it doesn’t!

Jordan has associated himself with a firm called Knowles Systems.  I went to their website, and was appalled by their misspellings and bad grammar.  (I’m old fashioned; I think that reveals a lot!)  I’m sure Jordan has checked them out, but I am going to stand by my negative opinion.

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