PROPERTY:
Fairford Way, Capitol Heights, MD 20743
LOAN OVERVIEW:
The borrowers are requesting a hard money loan to acquire an investment property under marketing value. The Borrower has already rehabbed and resold 2 properties in that exact same subdivision for over $110K each. He is buying this auction property for $52,500 and needs rehab work (around $25,000 to replace carpet, drywall repiars, kitchen and bathroom upgrades, paint and landscaping). The Borrower is putting up about $28K+ cash plus fronting the 1st construction draw. HMB has done 3 other successful deals with this Borrower.
PROPOSED TERMS:
| Loan Type: | Purchase |
| Loan Amount: | $60,000 1st Mortgage |
| Value of Subject Property: | $ 110,000 |
| Loan to Value: | 55% |
| Term requested: | 9 Month Balloon |
| Investor return: | 12% |
| Exit Strategy: | Resell property |
| Credit Score | lower |
HARD MONEY BANKERS COMMENTS:
The pros are:
The lender will have good collateral on an investment property purchased a good price. The borrower has done several other flips in this area and HMB has done 3 successful deals with him this year. He will be bringing $28K+ cash to closing.
The cons are:
The Borrowers exit strategy of selling could take longer than expected in this market.