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  • Closing Your Hard Money Loan

    Posted on 12/29/2004
    Some states permit escrow companies to generate certain docoumnets required for closing real estate transactions, while other states require attorneys to complete these tasks. To make sure your loan closes quickly and efficiently, get a complete list of the closing documents you will need as early as possible. Determine what specialists you will need to generate those documents. Find out whether you can fax copies or must send originals. If you are using an escrow company to complete documents, count on expedited service of a few days. If you use attorneys, count on 2-3 times as long.
    Posted in Miscellaneous

  • Costs to Close a Hard Money Loan

    Posted on 12/28/2004
    Hard money loans generally require more out of pocket expenses than residential mortgages from conventional sources. Be prepared to be asked by your hard money lender for about $5,000 to cover the costs of an appraisal, inspections, site visit by a company rep, reviews of your financial statements, etc.
    Posted in Miscellaneous

  • Average Closing Time for Hard Money Loans

    Posted on 12/27/2004
    Hard money loans can close in as little as two weeks. Avatar Financial Group has a documented ready-to-fund average time of 8-10 business days from the time they receive the completed loan package and supporting documentation.

    Actual closing times, however, tend to take much longer. Why? Clients tend to take their time in actually arranging for the final closing. Several reasons are offered by clients, including not being prepared with documents to prove income, financial status, title for the property, inspections, and other documents to support statements made in the initial application. Some clients get ready to close and then hold to the last moment to maximize the benefit of the loan, but not pay interest for a time when they don't yet need the capital.

    If you really need to close quickly, make sure you have documentation to support any claims of income, net worth, operating income and expenses, for the subject property, clear title, pay-off documents for prior loans on the property, etc. If you are prepared, the loan can close in as little as two weeks.
    Posted in Miscellaneous

  • Getting a Quote for a Hard Money Bridge Loan

    Posted on 12/26/2004
    To get a quote for a hard money bridge loan, visit websites which indicate they are hard money lenders. Be careful to avoid websites that describe their business as "loan originators", regardless of the search terms you used to to get to those websites. The term "originator" means you are dealing with a broker, not a lender. If you want to work with a broker, ask lenders who they might recommend. You are more likely to find an honest, capable lender that way.
    Posted in Miscellaneous

  • Hard Money Trends 2005

    Posted on 12/25/2004
    In 2005, look to the hard money to fuel the economy in real estate investments, building and construction. With conventional financing still holding very tight reigns more investors, builders, and businesspeople will turn to alternative, private lending sources.
    Posted in Miscellaneous

  • REO Properties

    Posted on 12/24/2004
    REO properties are most often commercial or residential real estate that is being sold by the government, an auction or a bank foreclosure as part of a fire sale.

    Althought the deals can be great, it's worth spending some time investigating the property thoroughly before considering a purchase. If unexpected damage, problems, maintenance issues, etc. arise during the due diligence process, closing a loan on these types of properties could fall through, leaving you in a bad position. Make sure to stay ahead of the game with solid research.
    Posted in Miscellaneous

  • Why 20% Borrower Equity?

    Posted on 12/23/2004
    Hard money lenders require that borrowers have 20% equity in the real estate they collateralize for a loan. The lender will fund up to 65% or sometimes even 70% of the purchase price. The borrower must have 20% and the 15% balance can come from a seller carryback.

    The reason for the borrower equity requirement is to ensure that the borrower has significant stake in the success of the project and the loan. If the borrower has no equity, s/he is more apt to drop off the keys at the first sign of difficulty, rather than try to work through the problem. 20% borrower equity significantly reduces the number of loans that go sour.
    Posted in Miscellaneous

  • How Much Can Avatar Fund?

    Posted on 12/22/2004
    Our resources are not unlimited, but we can fund some exceptionally large projects. Avatar can fund a single deal in excess of $10 million, sometimes up to $15 or $20 million if the deal hits our sweet spot. We can also partner with several other lending companies that we have close relations with to offer a loan of $50-$100 million or more.

    Please be aware that exceptionally large projects like these will require some additional time to close, as the due diligence process must be very thorough. However, our normal rates can still apply for projects of this size, making a large bridge loan through Avatar a very cost-effective deal.
    Posted in Miscellaneous

  • Comparing Lenders

    Posted on 12/21/2004
    The type of lender you want depends on the type of loan you're seeking, the property you're buying/collateralizing and the terms you'd prefer. Avatar Financial can be a good first stop because if we don't meet your needs, we can help refer you to other direct lenders who can provide assistance.

    We help brokers and borrowers place deals with qualified lenders because we think it's the right thing to do. And, we know that in the future, when you have a deal that meets Avatar's criteria, you'll give us a call.
    Posted in Miscellaneous

  • Funding Deals During the Holidays

    Posted on 12/20/2004
    Despite much of the financial industry slowing down over the next two weeks surrounding Christmas & New Year's, Avatar will be staying busy.

    You can still submit a loan online and expect to hear back within 24-48 hours with the exception of Christmas Eve & Christmas Day (although we may take a look even then!). Don't forget to include as much information as you can - photos, paperwork, etc.
    Posted in Miscellaneous