Table funding
Table funding is a closing where a loan is funded by another party’s money at the closing table and assigned to that party at closing. The originating lender closes the loan in its name without using its own capital.
The definition
Federal mortgage rules define table funding as “a settlement at which a loan is funded by a contemporaneous advance of loan funds and an assignment of the loan to the person advancing the funds” (Regulation X, 12 CFR 1024.2). That definition comes from consumer mortgage rules, but the same structure is used in business-purpose private lending.
How it works for a private lender
The lender underwrites the loan and issues the commitment. Before closing, a capital source reviews the file and agrees to fund it. At closing, the capital source wires the loan amount to the settlement agent, the loan closes in the lender’s name, and the note and mortgage are assigned to the capital source. The lender typically earns its origination points at closing and can keep servicing the loan.
Why lenders use it
- No cash of the lender’s own in the loan, so no haircut and nothing borrowed on its balance sheet.
- The capital source commits before closing, so the lender never carries a loan it then has to sell.
- The lender keeps the borrower relationship and, in many structures, the servicing.
For consumer mortgage loans, federal rules treat a table-funded originator as a loan originator (Regulation Z 1026.36). Business-purpose loans are generally outside those consumer rules, but state lending and licensing laws still apply: ask counsel about your states.
Read the full guide: table funding for private lenders.
Where Lender Capital fits
Lender Capital places first-lien, business-purpose real estate loans with capital partners. You apply once, then submit each loan with the full file. We send it only to capital partners whose criteria it fits, one partner funds the whole loan at closing and it is assigned to them. You keep your points (less the placement fee), earn the spread above the partner’s rate and service the loan. You pay a placement fee only when a loan funds.
Lender Capital is a business-to-business platform. This page is general information, not legal, tax or securities advice. Terms of warehouse lines and other funding sources vary by provider; confirm them with each provider and your counsel.