Haycock Road, Falls Church, VA 22043


The borrower is requesting a hard money loan to refinance a very large spec investment property that they purchased 6 years ago for $450,000 (land only) and then built a 7,000 sq foot house on it . The property has been completed except flooring throughout and the kitchen.  HMB is doing a full construction holdback for $100K to make sure all the work gets completed. The borrower is a custom builder by trade but went over budget on this project.   The property is listed for $1.69 Million with lots of showings but all the potential buyers want the property 100% completed before committing to buy it.  HMB is collecting 3 months prepaid interest on this loan.


Loan Type: Refinance
Loan Amount: $925,000 1st Mortgage
Value of Subject Property: $1,600,000
Loan to Value: 58%
Term requested: 9 Month Balloon
Investor return: 12%
Exit Strategy: Resell property
Credit Score 632


The pros are:

The lender will have good collateral on an investment property in a great area of N. VA at a low LTV.  The property is already listed for sale but just needs $100K more to finish the work in order to sell.

The cons are:

The borrower’s exit strategy of selling could take longer than expected in this market. His credit score is also lower than our portfolio average.