PROPERTY:

Good Luck Rd, Lanham, MD 20706

LOAN OVERVIEW:

The borrower is requesting a hard money loan to acquire an investment property. The property is being purchased under market value as a bank owned property for $140,000 and needs little rehab work (around $10,000 for kitchen and bathroom upgrades, paint and landscaping). The borrower are putting up about $32K+ plus fronting the 1st construction draw. The borrower has a 553 credit score, experience flipping properties and cash.  HMB has done 1 successful deal with this borrower.

PROPOSED TERMS:

Loan Type: Purchase
Loan Amount: $135,000 1st Mortgage
Value of Subject Property: $220,000
Loan to Value: 61%
Term requested: 9 Month Balloon
Investor return: 12%
Exit Strategy: Resell property
Credit Score 553


HARD MONEY BANKERS COMMENTS:

The pros are:

The lender will have good collateral on an investment property with minimal construction needed. The borrower has lower credit  but good assets and experience. The borrower will be contributing about $32K+ into this deal.

The cons are:

The borrowers exit strategy of selling could take longer than expected in this market.