"Beware" is all that I can say about Direct Lending Partners. I contacted DLP about funding a multifamily unit that I paid cash for. I am doing a MAJOR rehab of the property and I contacted DLP to see if one of their loans would work. I was informed of the appraisal/inspection fees, the Loan Origination Fees, the loan terms (interest rate, months, etc). I asked about additional/hidden fees because their advertisement said "No Hidden Fees". I decided to fill out the loan application and after sending in all of my personal info I was told that I was approved for a 500K Line of Credit. Fast forward a few weeks when I receive the HUD-1 statement from my title company and I see a total of $8,395 in ADDITIONAL FEES broken down as follows:
Commitment Fee = $895
Line of Credit Fee = $5,000
Legal Fee = $2,500
Interest to first payment (normal I guess so I don't consider this as a hidden fee) = $1,214.31
On top of that, I was initially told that the Appraisal fee was $595, then I received a email stating that an error was made and since my unit was a triplex, the fee was $695. Well on the same HUD-1 statement, there is an additional $105 fee for an appraisal, bringing the appraisal to $800. So my $164,900 rehab loan is now costing me $180,201.45 (actual numbers from the HUD-1). Needless to say I am looking for another lender. Fortunately I am not in a crunch to get the rehab started since I paid cash for the property and I have time to search for other lenders (any suggestions???)
My advice to anyone is to ASK for the lender's Pricing Summary Sheet so that you are aware of ALL of their fees. I am not a newbie to investing and I still make my rookie mistakes, but i know there are better lenders out there than DLP.
Do your own Due Diligence,,,
