Im a mortgage banker/broker on the East Coast that was solicited by LNB Commercial Capital to send them commercial financing deals. I had worked with LNB Commercial Capital in the past on a couple of commercial loan transactions and had no problems. All of this was before the financial meltdown. LNB Commercial Capital claims to be a direct commercial lender, when in fact LNB Commercial Capital is a correspondent. I found out that LNB Commercial Capital has a correspondent relationship with a direct lender out of PA for their small balance commercial loans. For their bridge fund, LNB Commercial Capital has a correspondent relationship with bridge fund out of New York, NY.
LNB Commercial Capital use to be reputable firm. The owner, Mike Nicolais and his company is starting to become just like the Remingtons and Kennedys of the world. They are starting to take due diligence/upfront fees and not performing any work or funding any loans. I sent them a loan for the refinance of $260k for a small apartment complex. LNB Commercial Capital then sent me a Letter of Intent (which I know is not a Commitment Letter) for the transaction. LNB Commercial Capital requested a $1900 upfront fee, of which $900 was non-refundable for due diligence and processing. The other $1,000 was for the appraisal.
This was not a problem, since I and the client understood that there are fees when doing a commercial loan. The problem occurred a week later when I was told by LNB Commercial Capital that they could not finance the transaction. At the point, I asked for the money back and was told it would be sent back. A couple of weeks later, I contacted them again because the client had not been refunded. After being persistent, I finally got to speak with the owner Mike Nicolais about getting the refund sent back to my client a.S.A.P. I told Mike Nicolais that If this how he does business, he would not be getting any mine ever gain. He then proceeded to curse and yell at me on the phone telling me that the money had spent!
I had asked him what he spent the money on? During the two weeks I was trying to get the money refunded back to my client, I by chance had contacted the direct lender in PA that LNB Commercial Capital is a correspondent with. Guess what the direct lender told me? They had seen the deal from LNB Commercial Capital, which was sent to LNB Commercial Capital from me, and would not be able to finance the transaction. I told this to Mike Nicolais and expected to get a portion of, if not all of the money refunded back the client. Well, two months later, still no money has been refunded back to my client.
Through some more digging on my own, I found out that this has happened in more than one instance with other brokers and their clients. I also found out that they actually had cut a brokers commission without telling the broker until the loan had closed!
If you want to protect your reputation and your clients money, LNB Commercial Capital and Mike Nicolais is not the place to would go.
0 comments