Due to COVID's uncertainty, an increasing number of lenders do not allow commercial property cash-out refinancing. We have noticed a risk reduction trend since the beginning of COVID. Since the beginning of the year, lenders have reduced the ratio on loan to value. Then many banks do not allow cash-out refinancing, focusing on purchases transactions. Unlike the residential market, the commercial investment market has been less active. Our banking system and banks have a very healthy balance sheet. However, it is the lending institution's choice of how they manage their lending practice. Besides the reduction of loan ratio, not cashing out, we also have learned several lenders would only lend to existing customers. Meaning if the borrower does not have an existing loan or bank account, the lenders will automatically reject the lending request, does not matter if this is a purchase or cash out request.
We have multiple relationships with the lenders. Cash-out refinancing is not a challenge for us. Many investors are looking for opportunities to invest in the commercial real estate market. These investors are shoring up with cash. And as they see fit, the cash will be invested in the real estate market. Lastly, for the first time investor, it used to be a requirement that we completely ignore. We have seen an increasing number of lenders going back to this rule. The general rule is the borrower should have at least one similar property with three to five years of experience managing a similar property. In our pipeline and already close properties, we are assisting our client with the below asset. There are most active properties transacting in the market.
We don't believe there is any interest rate upside risk next year. We do encourage investors to consider moving ahead with any cashout refinancing request immediately. Although the commercial real estate market is softening, the market is generally healthy and stable. Banks have offered 3 months forbearance if the commercial real estate experiences difficulty and requires assistance. The market has yet experienced a high degree of distress. Between the forbearance and the US government CARE act on PPP, EIDL, the commercial real estate market is sustainable. The market is anticipating any other round of government stimulus package. We believe there is no correction until the end of the next stimulus package. However at some point in time in the near future, once the stimulus is exhausted, and the forbearance requires has finished, there might be some minor commercial real estate market correction. Since no one can anticipate the future, but our readers would agree there has to be a correction in the commercial real estate market. And the bank lenders will continue to tighten their lending practice. We believe cash-out refinancing request should take place immediately.