All Forum Posts by: Alex Bekeza

Looking forward to it!

Completed 5 or more flips in the last 2  years?

Ready to scale up your flipping and new construction business?

Have a FICO of at least 700?

We have an incredibly helpful tool.  We have a Line of Credit for experienced and active flippers which is typically worth 5 times your liquidity.  Higher LTVs and Lower Rates than Hard Money.

 Fix & Flip:

• Rehab Fix & Flip Recourse
• We fund up to 90% acquisition
• We fund up to 90% rehab budget
• We fund 75% LTV/ARV
• We will fund the lower of the acquisition + rehab OR LTV/ARV whichever is lowest
• You will call Granite which is the 3rd party inspector once you have completed portions of your budget and are ready for your inspection and release of some funds. Please note; you must have line item 100% completed in order to receive the 90% maximum of that line item draw
• You will be charged interest payments on the entire funding “Acquisition + Hard Costs to Build”. We do not do balance accrual at this time.
• Please note you will fund your initial hard costs we will reimburse work completed

Please know for Fix & Flip and New Construction:

• Multi-Family/Mixed Use
• We fund up to 80% acquisition
• We fund up to 80% rehab
• We fund up to 70% LTV/ARV
• We will fund the lower of the acquisition + rehab OR LTV/ARV whichever is lowest
• Please note: Multi-Family/Mixed Use properties will be constrained to a loan amount equal to the lower of calculated cash flow, cost or valuation requirements. Mixed use properties with average individual residential units valued greater than $250,000 per unit are not required to meet cash flow requirements, however are subject to cost and value requirements.

Reach out to me via email or my cell and let's chat about how this LOC can help you take your business to the next level.

In order to qualify be prepared to answer the following:

• Fico – highest mid fico of all borrowers within the entity
• Liquidity = cash in checking/business accounts + 70% retirement, stocks, bonds, 50% unused HELOC on a primary residence
• Net worth – equity in real estate + cash
• Experience – how many flips and spec builds have you done in the last 24 months can you document that you were the seller on the closing statement? How many current active rentals do you own?

Ladies! Ladies!  Our brokerage is working with one lender in particular who has just rolled out an awesome initiative for female investors.  

*FREE APPRAISAL

and

*$1,000 Off of Underwriting Fees

They are pushing an aggressive campaign to add more female borrowers to their portfolio.

This is a commercial product that does not require Tax Returns or qualify you based on DTI.

-30 year terms, fully amortized

-Rates between 7-9%

-Rates fixed for first 3 years

-Cash Out LTV up to 70%

-SFRs, 2-4 units, Mixed Use, MF 5+ and Commercial property types 

*Occupancy Required

*650 Minimum FICO

Reach out to learn more as I would love to see more Female investors take advantage of this deal!

All the best,

Alex Bekeza

Other than special circumstances like you described with the lender who specializes in 401k funds you don't really see non-recourse loans until you're looking at loan amounts over $1 million.  A small balance commercial loan is going to require a personal guarantee 99% of the time. 

I wouldn't worry too much though qualification wise because there are many commercial lenders who will not even have a Debt to income ratio requirement and as you say, will only be interested in the performance of the property. They STILL will want you to personally guarantee the loan though. I have one in particular that would do 70% LTV Cash Out with 30 year term/amortization with the rate fixed for 3, 5, 7 or 8 years, vest in the LLC and never even request a tax return....

@Mike G. Absolutely!  and Likewise!

Commercial Loan Program Details (Full Documentation):

• Lowest interest rates guaranteed
• Tax returns and operating statements required
• Low credit requirements (660)
• Property must debt service
• Multi-family, mixed-use, office, warehouse and retail properties
• 5-year, 10-year fixed programs amortized for 25-30 years
• Up to 75% loan to value
• Loan amounts $500K – $100M

Commercial Loan Program Details (Lite Documentation):

• Agressive interest rates
• No tax returns or income verification required
• Low credit requirements (620)
• Multi-family, mixed-use, office, warehouse and retail properties
• 3-year, 5-year fixed programs fully amortized for 30 years
• Up to 75% loan to value
• Loan amounts $100K – $5M

Several Different Factors limit or at least narrow down the options here.

1.  The Loan Size

-This type of loan is considered "Small Balance Commercial".  Many MHP friendly lenders who may have taken it on might turn it down for being under $250k or some similar arbitrary minimum loan amount requirement.

-So now in my mind I'm thinking we can only look at a lender whose minimum is lower, say $100k.

2.  Location

-Most nationwide wholesale/private/commercial lenders have minimum population/local economy requirements.  What city is this in?

If its too rural, I would start searching smaller microlocal lending sources.

3.  POHs

-Biggest obstacle with financing MHPs is the fact no value is assigned to Park Owned Homes.  From your brief description I would glean that these are all tenant owned homes who pay lot rent.  (THIS IS THE BEST SCENARIO).  Lenders are lending on the value of the land + improvements (ability to produce lot rent).

Hope this helped a little bit.

Feel free to reach out anytime. 

@Heather M.

I've sent you a private message.

The demand for commercial loan products, even on 1-4 unit properties has never bee higher. Rising conventional rates are narrowing the gap between them and commercial. They are ideal for self employed investors or any experienced borrower who does not meet the DTI requirements for conventional financing. This is a common problem for many investors who have significant write offs making their income appear lower.

Many people aren't aware that there are also 30 year, fully amortized commercial products out there.  

@Beverly Hinds

You could also get a commercial loan. They'll base the loan on the income produced by the property not the borrower. Lately, the gap between commercial and conventional rates is narrowing with commercial rates in the 6-9% range. There are commercial products out there with 30 year amortization to help keep payments low and you can cash out between 70-80% LTV.

To answer part of your other question.  Hard Money Lenders will not care about your employment.  Most of them use stated income underwriting methods.

Feel free to reach out anytime.  

@Joel Florek Sounds like you've got a good system figured out.  

-I asked because I was hoping @Darius Falahkhir would share the name of the bank.  I like to make note of local banks terms when I come across them in case it made sense to reach out to them for a client in that area at some point.  The terms are good, especially for an out of state investor who presumably doesn't already have accounts there.  

-As far as small balance commercial loans go those are great terms.  Like @Jay Hinrichs pointed out.  Rates tend to be a little higher on average.  Small Balance Commercial floor rates tend to start in the 6% range and go into the 8% range.  However, the class of loan programs I'm talking about don't balloon.  They're 30  year terms, fully amortized.  For all of the reasons Jay mentioned short term balloon products aren't my first target for clients.

-If you're really only paying $1,500 for a $550k loan and the interest rate isn't swollen with YSP then I have to assume those bankers have pretty sweet salaries.  Considering that is around 1/3 of a point.  Its unheard of.  I keep my origination fees flexible to compete but that's not even in the ballpark of industry standards.  99% of us work on commission alone.  Not a penny until the loan closes.  That being said, if your looking at motivations, we obviously have a way higher incentive to get the loan closed charging a reasonable fee.  

-Allowing some subordinated debt via seller financing is somewhat common in small amounts (10% or so) but I'm always impressed when an investor pulls it off!

-I can only assume that you are one awesome borrower to work for and must make it easy for them to  get these loans closed. 

Happy New Year!  I'd be happy to sharpen my pencil to present a loan scenario in 2019!