Assumable Debt for Commercial Real Estate Buyers

Assumable Debt Advisory for Commercial Real Estate Buyers

In this market, in-place debt can be the difference between winning and losing. If a property has assumable financing, the buyer can sometimes inherit a rate and structure that new lenders will not match. We help buyers underwrite assumable debt, manage the lender consent process, assemble the transfer package, and coordinate the closing path. For related financing options, see Real Estate Financing and Private Credit.

Assumable debt is not “free leverage.” It is a lender-controlled transfer with underwriting, fees, conditions, and timelines. We translate the loan documents into a buyer action plan, pressure-test the covenant and reserve burden, align the equity plan with lender requirements, and run a controlled workflow through consent and closing. If you are still sizing capital for the purchase, see minimum equity requirements and how lenders look at sponsor strength.

Scope of Services

Loan Document Review

  • Read the note, loan agreement, and assumption provisions for transfer mechanics
  • Map financial covenants, reporting, reserves, escrows, and cash management
  • Identify fees and penalties: assumption fees, legal, transfer taxes, and lender conditions
  • Clarify recourse and carveouts, guaranty requirements, and required entities

Underwrite the Debt Burden

  • Build a debt service and cash flow bridge from in-place to stabilised case
  • Stress test DSCR, debt yield, vacancy shocks, and capex timing
  • Model required reserves, replacement reserves, TI, leasing commissions, and escrows
  • Define the equity plan, sponsor support, and liquidity buffer required to pass consent

Assumption Package Build

  • Assemble the lender submission: buyer profile, financials, rent roll, and operating history
  • Draft the transaction narrative built for the lender credit team
  • Create a controlled data room and checklist with version control
  • Coordinate third-party reports where required by the lender

Consent and Closing Management

  • Manage lender Q&A and follow-ups tied to your PSA timeline
  • Track conditions to consent and prevent scope drift
  • Coordinate closing items with counsel, escrow, and lender teams
  • Support any gap funding if proceeds or equity requirements change

What Assumable Debt Looks Like in Practice

  • A lender consent process with full buyer underwriting and closing deliverables
  • Transfer documentation that can include entity approvals, guarantor requirements, and reporting setup
  • Replacement reserves and escrows that affect true cash-on-cash returns
  • Cash management, lockbox, and lender controls that continue after closing
  • A buyer equity plan that may need to be higher than expected to satisfy consent metrics

If assumable debt does not clear consent within the PSA timeline, you usually need a backup plan. See Commercial Real Estate bridge loans and unitranche financing.

Common Friction Points We Solve

  • Buyer net worth and liquidity tests that are not aligned with the sponsor plan
  • Unexpected reserve requirements that change the equity check at closing
  • Guaranty and carveout language that creates hidden personal exposure
  • Lender counsel timelines, consent conditions, and documentation bottlenecks
  • PSA timing conflict: seller wants speed while the lender wants diligence depth

If the lender requires additional credit support, see loan guarantees for Commercial Real Estate and how guarantor strength impacts approval.

Eligibility and Dossier

Best Fit

  • You are under PSA or near PSA with a defined closing date
  • The existing loan has a clear assumption clause, not a vague consent promise
  • You can document liquidity and net worth in a lender-ready format
  • You want an execution plan with a backup financing path

Core Dossier

  • PSA, existing loan documents, and current servicer or lender contact details
  • Rent roll, trailing operating statements, and property narrative
  • Buyer financials, liquidity proof, and ownership structure
  • Capex plan and leasing plan where relevant
  • Any lender correspondence on assumption conditions and timing

If you need help underwriting the asset for lenders, see how to underwrite a Commercial Real Estate deal.

Process

Intake

Mandate signed. We review the PSA timeline, the existing loan documents, and the consent requirements that will drive the path.

Underwrite the Debt and Build the Plan

We model the real debt burden, reserves, and covenants, then define the buyer submission strategy and backup financing plan.

Build the Assumption Package

We assemble a lender-ready submission and controlled data room, then pre-answer the typical lender questions before they slow the deal.

Consent Management

We manage Q&A, track conditions, coordinate third-party items, and keep the lender on a timetable aligned to your PSA.

Close

We coordinate documentation and closing logistics with counsel, escrow, and the lender team through closing and transfer completion.

Pricing Guidance

  • Advisory retainer from USD 59,500 based on loan complexity, timeline, and submission workload
  • If a backup financing mandate is required, scope and pricing are confirmed in writing
  • Third-party costs may include legal drafting, lender counsel fees, appraisal, engineering, and insurance items
  • Final scope is confirmed after document review and lender consent requirements are known

Assumable debt works best when the lender consent process is treated like a closing, not a casual request.

Request Assumable Debt Review

Share your PSA, existing loan documents, rent roll, operating statements, and buyer liquidity profile. We respond with feasibility and next steps.

Include the lender contact, consent timeline, and any known conditions. We act as advisor and arranger and coordinate execution through regulated counterparties where lending or securities intermediation is required.

Request A Quote

All transactions are subject to KYC and AML, sanctions checks, credit approvals, diligence, and signed agreements. We do not guarantee lender consent, pricing, proceeds, or closing outcomes.

Financely acts as advisor and arranger. We are not a bank and do not take deposits. Financing outcomes depend on lender approvals, diligence results, legal documentation, and counterparty performance. Nothing here is a guarantee of consent, funding, or closing.