Our private money construction loans are based on the equity in the property and not necessarily on the credit profile of the borrower. Banks must look at the construction borrower’s credit, income and assets to qualify for a loan. With private money lenders, there is greater flexibility with regard to the types of loans and the circumstances under which money will be lent.
We understand that private money borrowers have circumstances that affect their ability to borrow through conventional means and must look to private money to finance their projects. We will look at the project and lend based on the equity in the property, not the borrower’s credit. The strength of the collateral is generally more important to private money lenders than the qualifications of the borrower.
The private money borrower should be prepared to provide us with a summary of their project, which is to include: acquisition cost of the subject property, construction costs, closing costs required in the loan, term of loan needed, borrower’s experience, an exit strategy, borrower’s income and general credit picture and an estimated “as is” value and after improved value.
We would like to see that the borrower has enough stated income or enough stated liquid or cash assets to get through the project. The borrower must have the capacity to make payments* for the duration of the project and be able to weather any unexpected hiccups during the course of any type of loans.
(*An interest reserve account will typically be in place to handle payments)
Our private money loans require no prepayment penalty, will lend up to 65% loan to value, will consider cross collateral, have an easy application process with no upfront fees and have terms available of up to 24 months. We will entertain loan amounts to $4,000,000. It is generally possible to place private money loans very quickly after an analysis of the project and review of the borrower’s information.
Our borrowers will pay interest on the full amount of the loan for the duration of the loan. The funds are not available to the lender throughout the duration of the loan because the lender has committed these funds and cannot utilize them in any way or earn interest. The loan funds will be disbursed throughout the construction phase of the project and when the borrower has demonstrated that the project is 100% complete, any remaining funds in the construction/commercial account will be disbursed to the borrower.
Private money loans often provide a financial solution for borrowers who do not fit into usual bank underwriting guidelines.
Contact us for a review of your particular scenario.
CA BRE #01307829
1250 Pine St.
Walnut Creek, CA 94596