Loan Guidelines

Loan Guidelines

Interest Rate

Rates are between 12% and 16% depending on the deal size and borrower rating quality.

Origination Fee

Our loan includes a fee of 3-6 points depending on the deal size and borrower credit quality. We allow borrowers to finance these fees (include them in the loan as opposed to paying them at the table).

Loan Term

Our standard loan term is between 9-12 months. We have found that, in the current sales market, it is taking longer to procure deals and sell properties and as such, we increased our minimum term to 9-months. As the sales market improves, 6-month terms will be available. We allow borrowers to extend loans if necessary.

Interest Reserve

We hold a minimum of 3 months interest payments for each loan. This allows the borrower to focus on the rehab and marketing of the property instead of the first three payment deadlines.

Rehab Reserve

If we are providing rehab/construction funds in addition to the acquisition, we setup a reserve at closing that will be used to fund your rehab draws. We typically have one to four draws on renovation reserves that are refunded for completed work. See Draw Process.

Pre-Payment Penalty

There are no prepayment penalties.

Investment Property Guidelines

First Mortgage

First mortgage only, no subordinate financing without approval

Property Types

Residential, Mixed Use, Multifamily.

Borrower Criteria

Minimum of 650 credit per borrower (mid-score – for “flip” deals). Minimum 700 credit per borrower (mid-score – for “refi” deals)
Minimum Liquidity Requirement: $25,000 – (also depends on loan size)
Personal guaranty required