All Forum Posts by: Amir Levi

Most genuine HMLs will lend you 65% of purchase at 10% and 2 to 3 points.   4 units is tricky, however.  You must be able to convince them that you are not going to live there.  Otherwise the lender will be limited by many rules and regulations and disclosures, and he may shy away from lending $ to you.

All the best

Amir

I am a CA RE broker. I also own a CA LLC, which I am a single member of.

Can I lend money with my LLC as the lender and myself as the broker? or do I need CFLL to lend using my own LLC?

Ann Bellamy, you are very correct. I looked up the definition of "hard money" and your's was it. I do remember, when I was studying for my Broker Lic. years past, that was one of the subjects, and it defined cash out for hard money definition. I must have misread then :-), and stand corrected.

As far as I know, in CA, there is no distinction between borrowers, when it comes to usury law. 10% is the limit, no matter who lends to whom (if none lic. lender and no broker involved). You might want to consult your atty, for better interpretation of the law.

In CA, once an unlic. constr. worker engages in work on your property, he will be acting illegally, unless he is an employee.

He can not be an independent contractor, working in construction, if he is not licensed by contractor's lic. board, period. The law is very clear in this regards.

You must consult your atty, and this is not to be construed as legal advice.

Amir

You can ask any local RE broker, or loan broker to help you negotiate transactions, for a fee. If you bring the deal, you bring the parties, then you may be able to pay half a point to a broker to negotiate the transaction. Remember, he can not just be a figure head, he must negotiate the deal to be exempt from usury laws in CA.

There are no exceptions, a none lic. individual or a none lic. company can not charge more than 10% in CA, unless a broker is involved.

This is not a legal advice, you should consult an atty to get all the facts straight.

In CA an owner builder doesn't have to be licensed to pull permit and work on his property. You will need workman's comp insurance if you hire workers on the job. A none lic. constr. worker can work on your project, but he is considered an employee. Make sure you pay taxes on him and get insurance for him.

If you convince your lender that your crew is good, then there should be no problems to get a hard money loan. The lender should rely on you, mostly, and your rehabbing experience.

I have lent on several similar situations in the past myself.

Hard money lending business is all about patience.

Things must be accomplished one step at a time and cannot be rushed. Can't pull on seedlings to help them grow.

It is frustrating when a borrower takes you to the point of signing and walks away. It is also frustrating when a lender takes you to the point of signing and adds new terms to the loan.

Hard money lenders are not looked upon with a lot of trust by the general population. Hard money is thought to be "money from loan sharks and criminals". But in reality the word "hard" refers to "cash out" and has nothing to do with bone breakers. Hard money refers to cash out and soft money refers to refi of existing loan, i.e no cash out.

Yet, the reputation of hard money lenders is not very bright.

So, it takes a lot of patience and perseverance to stay the course, and not be frustrated by a "shopper", no matter how difficult they are, no matter how many times they go to sign and pull out the last minute. It is easier said than done, but this is part of business and it is what it is.

Amir

Bill Gulley

Couldn't agree more.

Don't ride a fierce dog to catch a lame rabbit.

I am amazed at how high the rates are in FL.
In Los Angeles I have a hard time getting more than 10% lately.
Am funding a commercial prop now, 50% LTV, at 10% and no points, and borrower keeps haggling with me :-)

Amir