PROPERTY:
Sachem Drive, Forest Heights, MD 20745
LOAN OVERVIEW:
The borrowers are requesting a hard money loan to acquire an investment property. The property is being purchased under market value as a bank owned property for $69,000 and needs rehab work (around $10,000 to replace carpet, kitchen and bathroom upgrades, paint and landscaping). The Borrowers are putting up about $30K+ of their own cash plus fronting the construction money. Â The borrower has a low credit score but has a lot of experience flipping properties, equity in other properties and cash..
PROPOSED TERMS:
| Loan Type: | Purchase |
| Loan Amount: | $50,000 1st Mortgage |
| Value of Subject Property: | $200,000 |
| Loan to Value: | 30% |
| Term requested: | 9 Month Balloon |
| Investor return: | 12% |
| Exit Strategy: | Resell property |
| Credit Score | 506 |
HARD MONEY BANKERS COMMENTS:
The pros are:
The lender will have good collateral on an investment property with minimal construction needed. The borrowers has good assets and experience. The Borrowers will be contributing about $30K+ into this deal.
The cons are:
The Borrowers exit strategy of selling could take longer than expected in this market.