Success Stories

Negotiating the Hidden Swap Spread

The Situation
Borrower’s bank had quoted borrower and “indicative all-in fixed rate” of 5.15% for 5 years on a $9,000,000 loan. Borrower had negotiated the loan spread, but was unaware of the additional swap spread, which is unseen.

The Solution
Swap Negotiators created transparency utilizing the same tools and models employed by the bank to determine and bring to light the swap spread. Once that spread had been determined, Swap Negotiators negotiated the spread down to better reflect the calculated market exposure relative to the bank’s risk on the loan. The result was a fixed rate of 4.76% and a savings to the borrower of more than $166,000.