| Loan Amounts |
|
| Advance rate/Loan Amount |
- Maximum 80% of TCOP (Total Cost of Project includes Purchase Price, Rehab Budget and closing cost) or up to 70% of ARV (Lower of the two)
- ARV includes purchase and repairs
- Subject to appraisal, only if necessary
|
| Term |
- 6-12 months; subject to extension in certain instances based on borrower’s demonstrated ability to perform to date
|
| Interest rate |
- Range of 6.9% to 11.9% per annum once underwritten (lower interest rates supported by the extent of demonstrated repeat business)
- Payable on the full amount of drawings put into escrow prior to initial draw
- Based primarily on loan-to-value, loan-to-cost, and the borrower’s experience investing in real estate
- Calculated based on a 360-day year consisting of twelve 30-day months
|
| Property types |
- SFRs, 2-4 units, condos, town homes, PUDs. In addition, loans on commercial real estate are considered
|
| Monthly payment |
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| Prepayment |
|
| Fees |
Due upon loan approval from borrower
- $100 application fees once pre-qualified credited to other fees
- $499 appraisal fee (only in the event an appraisal is necessary)
- Lender documentation fee of $450 paid by borrower
- Zero processing fee
- Title services fee and lender’s title insurance
|
| Credit score and Financials |
- Soft credit pulled on an exception basis, hard credit is not pulled.
- Financials only if needed to be sought by the lender after initial review
|
| Security |
- First lien mortgage on the property only – no loans liens permitted to be placed against the property
- Personal guarantee
|
| Insurance |
- Required through one of the lender-prescribed insurance carriers or a demonstrated reputable carrier; 6 months of prepaid premiums required at 80% of ARV
|
| Qualifications |
- Down payment in liquid accounts
- 20% of rehab and 6 months PITI for subject property in reserve accounts. i.e., IRA, 401k, Stocks/Bonds
|
| Points |
- 2.0-3.0% paid at time of loan closing
- Same points as per above if loan is extended past 6 months at the agreement of the lender and assuming no default (namely an additional 2.0-3.0% upfront as if a new loan origination)
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| Closing/Funding |
- Funding at closing –Targeted as little as 10 days assuming no titles issues (and post appraisal, only if appraisal is required which is sought on an exception basis only)
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| Draws on escrowed funds for drawings |
- Borrowers applying for a loan that includes escrow funds must submit a detailed construction scope of work with their loan application, and must provide certain supporting information and evidence before receiving disbursement of any escrow funds
- No cost to draw–released from escrow for reimbursement upon demonstrated completion of stage of repairs/rehab milestone and contractor/supplier/vendor confirmation of no liens (materialmen lien waivers)
- Staged releases-no more than 1/3 of total rehab fundings in escrow anticipated to be drawn at any point
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