Market volatility shows lenders and borrowers need to cooperate
November 10, 2014, Real Estate Capital
By Jamie Macdonald and Jenane Gazal
In loan negotiations, many zero-sum games remind the parties that they are on opposite sides. Defining the reference interest rate over which the margin applies isn’t one of them, but, as recent market turbulence shows, this term carries a lot of value to both parties. For fixed-rate or floating-rate loans, this rate can change rapidly.