Frequently asked questions
A Hard Money Real Estate Loan is a direct, short-term, asset-based loan that is secured by real estate. The loan funds both the purchase and rehab of an investment or commercial property. The loan is funded through an investment fund instead of a bank.
Asset-based means that the loan is secured by an asset or property. This is usually the asset or property that is being purchased by the borrower, but can also be other assets or properties that are owned free and clear by the borrower.
Fix and Flip, Single Family, Multifamily, Condo Conversions, Mixed-Use, Office/Retail, Commercial, Industrial and Refinances.
The loan amount is determined by the As-Is value and the After Repair Value (ARV) of the property.
The As-Is Value and the After Repair Value (ARV) of the property are determined by an independent, third party appraisal company.
The After Repair Value (ARV) is the future value of the property after rehab is concluded. The appraiser will use comparable properties in the area along with a detailed scope of work provided by the borrower's general contractor and/or architect in order to determine the property's ARV.
We will lend up to 80-85% of purchase price and 100% of rehab costs. The total loan must be 70% or less of the calculated ARV.
The rehab portion of the loan is released in draws.
On average, for loans of $84K or more, we require a 3 point Origination Fee at closing on the loan amount plus 12% Interest on the loan amount for a term of 12 months, interest-only payments per month. For loans under $84K, we require a flat fee of $2500 at closing.
The borrower is responsible for closing costs. The borrower is responsible for a $1500 due diligence deposit (depending on the deal) upon signing the term sheet. This $1500 deposit is credited to the borrower at closing and is used towards appraisal, title, and legal fees. This is NOT an extra fee.
We reserve the right to check a borrower's credit score, but it does not determine the loan. We are most concerned with the asset that is securing the loan and not credit score.
No, we do not. We strictly lend on investment and commercial properties.
We have the ability to close a loan within 2 weeks.
$50K to $5 million.
