Hard money loan #16 kicked off a few days ago. This is a loan on a property bought at foreclosure auction in Antioch, California, which is east and a tiny bit north of San Francisco. The borrowers are two people who have borrowed from us before. They purchased the property for $220,000. (The bank took a $400,000 loss on this one - ouch!) Our loan, secured by a first mortgage, is for $162,000, giving a LTV ratio of 73%. The borrower tells us he already has a buyer in line for the property at $270,000. (Until we're in escrow, I wouldn't hold my breath. Deals fall apart all the time.) My partner figures it's worth between $270,000 and $280,000. This seemed like it was a fairly hot property at the auction - there were a total of 8 parties bidding on it. The property is a two story single family home of about 2,300 square feet. It was built in 2000 and has 4 bedrooms and 2 baths. A nearby comp is currently in escrow for around $255,000 and it sold quickly at that price with multiple offers. And it still needed paint and carpet and is a slightly inferior model.
Standard loan deal - 1 year, interest only payments, 9% net to investors.
Friday, January 28, 2011
Another Hard Money Loan Started
Subscribe to:
Post Comments (Atom)
3 comments:
Hi Shaun,
Are you interested in other hard money deals? We are experienced rehabbers in Seattle looking to work with private investors to fund.
I don't have any more available funds right now and Seattle is out of my knowledge area (and my partner's). Sorry.
It's good to see that you are lending based on the numbers and not really based on what the borrowers tell you (have a buyer lined up). Smart. Deals do fall apart all the time. It is easy for someone to tell you they are really interested in a house and then are no where to be found when it comes time to sign a contract. Ask me how I know.
Post a Comment