What range of rates are you seeing in today's market? Regarding senior debt

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September 06, 2022

by a searcher from New York University - Leonard N. Stern School of Business in New York, NY, USA

I wanted to get a pulse and poll the current landscape out there. What are the rates seen and quoted on senior acquisition loans? I been talking around and rates are high, or much higher than many of us have seen for decade +. Prime rates are at 5.5% and SBA loan are + 2-2.5%. I've heard others quote double digits. People need to realize with senior debt rates pushing up, the cost of capital goes up for everything including preferred equity. Preferred equity once at 8%-10% may not suffice in today's interest rate market. I wanted to know if anyone out there has had a better optimal capital structure or a more creative way in the current environment.

*Higher interest rate should not solely dismantle a deal, but it is highly important.

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Reply by a searcher
from Oregon State University in San Antonio, TX, USA
I was quoted 12% for a bridge loan###-###-#### year term, interest only payments, balloon. Private lender. Not sure if the lender was legit or not though.
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Reply by a searcher
from Rensselaer Polytechnic Institute in Durham, NC, USA
FWIW, I just received term sheets for prime + 1.75% from several SBA lenders for a deal in flight.
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