The risk retention rules and increased reserve requirements, which go into effect at the end of 2016, will put even more pressure on traditional lending sources, limiting their capability to provide clients with construction loans for new properties and refinancing of existing loans. With nearly $300 billion in loans coming due in the next 18 months, non-traditional lenders, including online marketplace lending platforms, will have an opportunity to fill the void and provide borrowers with access to alternative forms of capital.
Gary summed up the situation well (see above) but didn’t mention the next iteration. Traditional lenders are going to have to adjust their terms to stay competitive.
As financial regulators increasingly restrict their options, what are changes in terms that you expect traditional lenders to give?