W St, NW, Washington, DC 20009


The borrower is requesting a hard money loan to purchase a property in a great area of NW, Washington, DC that we be converted into 4 condo units.  All units will be about 1,000 sq ft, 2 beds and 2 bathrooms.  There are many other conversion active and sold in this area and street as well as a smaller complex next door.   The purchase price is $1,150,000 and $750K in construction costs.  All construction costs will be in escrow and only reimbursed on completed work.  The borrower has completed other similar projects to this.


Exit Strategy:Refinance property

Loan Type: Refinance
Loan Amount: $1,600,000 1st Mortgage
Value of Subject Property: $2,600,000
Loan to Value: 62%
Term requested: 12 Month Balloon
Credit Score 700+


The pros are:

The lender will have good collateral on an investment property in a good area of DC.   HMB will be doing a construction escrow for the full amount of $750,000.

The cons are:

The borrower’s exit strategy of selling could take longer than expected in this market.