Jefferson St. NW, Washington, DC 20011
The borrower is requesting a hard money loan to acquire a lot to build a 3,000 sq ft brand new home (2,000 above grade and 1,000 below grade). The property is being purchased under market value for $151,000 (which is good for that area since there’s a lack of inventory). The borrower has a lot of experience flipping and building properties and does many transactions on a monthly basis. The Borrower is putting up about $34K+ of their own cash. The property needs $196K in work. The borrower is strong with a 684 credit score, experience flipping properties and money in the bank. HMB has already done many successful transactions with this Borrower. HMB is doing a full construction holdback and only reimbursing funds on completed work.
|Loan Amount:||$347,000 1st Mortgage|
|Value of Subject Property:||$550,000|
|Loan to Value:||63%|
|Term requested:||12 Month Balloon|
|Exit Strategy:||Resell property|
HARD MONEY BANKERS COMMENTS:
The pros are:
The lender will have good collateral on an investment property with minimal construction needed. The borrowers have strong credit, good assets and experience. The Borrowers will be contributing about $34K+ into this deal.
The cons are:
The Borrowers exit strategy of selling could take longer than expected in this market.