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» Hard Money Loan Saves Apartment Construction Project
Property Description:
Loan: $3,500,000, Project: 22-unit apartment building, LTV:64%
Predicting ‘snags’ that might increase a budget or delay completion of a project is one of the most tasks in construction. A few snags put a 22-unit apartment building project in California over budget and behind schedule. Personal funds contributed by developer, as well as a construction loan were depleted. The project approximately 95% complete, but contractors had stopped work for lack of payment. The developer has substantial equity in the property, but he was unable to obtain bank funding. He was about to lose the entire project for lack of the last piece of financing to see the project through to completion. An alternative lender was needed to provide fast and creative financing. Avatar Financial Group put together a loan package of $3.5 million dollars. The construction lender and contractors were paid, clearing the contractor liens from the property. The remaining $200,000 provided the needed capital to complete the project. Avatar’s package provided affordable monthly payments with partial interest-only monthly payments, an accrual of the additional interest due, along with a one-year balloon payment. The project was put back on track.
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