South End Capital Reports over $1.3 Billion in Non-Conforming Loan Applications for 2015; Forecasts $2 Billion For ’16

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Surge in demand from small business owners and property investors signals continuing economic recovery and drives SECC's quest for new capital partners

Licensed California finance lender-brokers, in particular, are perfectly positioned to capitalize on this rapidly evolving marketplace.

South End Capital (SECC) Managing Director Noah Grayson has reported 2015 commercial financing applications from small business owners and property investors grew dramatically over 2014 with late 2015 applications alone increasing 263% over the same quarter (Q4) in 2014. The seven-year-old boutique lender and finance firm received almost 2,200 loan applications in 2015 comprised of 1,436 small business loan requests totaling almost $690 million, and 760 applications of just over $660 million for non-conforming residential and small-balance commercial real estate investors.

“A surge in applications doesn’t always signal a strengthening economic recovery,” said Grayson, “but an increase of this magnitude—when SECC had not materially altered marketing efforts year over year—prompted a closer look at the source of the financing requests.”

Analysis of the 2015 application pool versus pre-2015 recession years revealed that though applications from the earlier years were heavily skewed toward distressed financing scenarios, 2015 applications largely involved healthier business and property pictures, an undeniable indicator of an economy in full recovery.

“In 2015, requests from small business owners seeking working capital to grow advertising and staff, purchase equipment and property were robust and persistent,” Grayson reported. He added that property investors also came back full-force last year, “with a significant percentage of our loan requests focused on the non-owner-occupied residential investment property market.”

Grayson admits that by the close of 2015, the unexpected swell of applications had all but strained the firm’s capital resources. “We’re now in discussions with our existing capital sources to increase our lending capabilities for 2016-17, and we will be pursuing new investors and capital partners to ensure we can convert as much of our 2016 application volume as possible.” Grayson projects 2016 to be another year of landmark growth for SECC, with application volumes estimated to represent in excess of $2 billion.

He predicts growing capital demand in the small business sector and also “an explosion” in the non-owner-occupied residential financing space through Q4 2016 and beyond. “In the first month of 2016 alone,” he discloses, “we received 295 loan applications totaling roughly $160 million—113 and $20 million of which have been for non-owner-occupied residential financings, 91 and $57 million of which have been small business loan requests, and 91 and $81 million for small-balance commercial loans.”

Grayson also anticipates increased compliance in the commercial financing space for 2016-2017, with recent CA legislation SB-197 likely to pave the way for the passing of similar laws in other states: “Licensed California finance lender-brokers, in particular, are best positioned to capitalize on this rapidly evolving marketplace.”

SECC welcomes both borrower and broker inquiries. The firm also offers generous referral fees to approved partners. To inquire about this release or any of the many innovative programs available through South End Capital Corp., contact Noah Grayson directly at (888) 268.7778 ext. 5, or noah(at)southendcapital(dot)com.

About South End Capital Corporation
South End Capital Corporation (SECC) was founded in 2009 and is a nationwide, non-conforming lender (CA Finance Lenders and Brokers License # 603 L334) providing collateralized and uncollateralized loans to business owners and real estate investors directly and in participation with third-party lenders.

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Noah Grayson
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