Railroad Ave, Pasadena, MD 21122
The borrower is requesting a hard money loan to refinance a free and clear investment property. The property was purchased in cash for $150,000 and needs rehab work (around $25,000 to replace carpet, kitchen and bathroom upgrades, paint and landscaping). The property is worth $150K as is and $200K after rehabbed. HMB is doing a full construction hold back for all construction costs and only reimbursing on completed work.
|Loan Amount:||$75,000 1st Mortgage|
|Value of Subject Property:||$ 200,000|
|Loan to Value:||38%|
|Term requested:||9 Month Balloon|
|Exit Strategy:||Resell property|
HARD MONEY BANKERS COMMENTS:
The pros are:
The lender will have good collateral on an investment property at a 50% ltv based off the “as is” value and 38% based off the ARV.
The cons are:
The Borrowers exit strategy of selling could take longer than expected in this market.