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  • Avoid Up-Front Fees

    Posted on 10/9/2004
    Never pay an upfront fee to have your loan reviewed by a lender. You are the customer; the lender is making a sales pitch by reviewing your loan request and letting you know if they are good match for your request.

    There are some fees that have to be paid in advance of closing a loan - more about those tomorrow, but never pay to have a lender tell you they want your business.
    Posted in Miscellaneous

  • Listing Assets

    Posted on 10/8/2004
    Your financial statement will include a listing your assets. Includes such things as the cash value of insurance policies, checking and savings accounts, stocks, bonds, real estate, property such as vehicles, equipment, technology, furnishings, etc. When in doubt, list it.
    Posted in Miscellaneous

  • The Right Appraisal Makes the Difference

    Posted on 10/7/2004
    If you already have a written appraisal on the subject property, send that along with your initial loan request. If not, locate at least 2 licensed real estate appraisers in your area and get quotes. Be sure to get a real estate appraisal, not a business appraisal. You may need both if you are buying a business, but the hard money lender will need a real estate only appraisal to fund your loan.
    Posted in Miscellaneous

  • Income Producing Properties Get the Best Rates

    Posted on 10/6/2004
    When choosing investment property, look for three things:

    * income producing capability * good location * solid appraised value

    Income producing properties with earnings of one and one-half the expenses get the best rates for purchases or when refinancing. Shoot for success: choose income producing properties.
    Posted in Miscellaneous

  • Finding Equity for Your Loan

    Posted on 10/5/2004
    If you are obtaining a hard money loan for a purchase, a good rule of thumb is to count on 65% from Avatar. Another 15% can come from a second loan and the balance of 20% will come from your own cash or additional collateral you own. If you have other real estate property, Avatar can collateralize both properties to make your loan possible.
    Posted in Miscellaneous

  • How to Close in Two Weeks

    Posted on 10/4/2004
    We often hear that a deal must be closed in two weeks. It is possible to close that quickly, if you have supporting documents and closing cost money ready. Be prepared by downloading the application on the forms page of our website. And be prepared to send approximately $5000 in due diligence costs before we get on an airplane with appraisers, inspectors, etc. to come see your property.
    Posted in Miscellaneous

  • LTV - Fiction & Reality

    Posted on 10/1/2004
    LTV means "loan to value". The lender will determine the "value" of a property by the actual selling cost. Appraisals may provide a much higher number. However, in the event you default on the loan, the lender will have to sell the building quickly - probably at or below the great price you are paying for it today.

    Be prepared to work with a loan that is a reasonable percentage of the actual purchase price of your property.
    Posted in Miscellaneous

  • Property Descriptions

    Posted on 9/30/2004
    When describing the property you want to buy or refinance, include the following info:

    * Year it was built & renovation yrs
    * Type of construction
    * Purpose or use of the building
    * Income producing? If so, gross/net income
    Posted in Miscellaneous

  • Photos - The First Thing You Will Need

    Posted on 9/29/2004
    If a hard money lender is interested in your loan request, the first thing you will be asked for are photos of the "subject property". Email clear photos, with sufficient light, of the interior, exterior, and the neighborhood to show the lender that the property is worthy of consideration. Be prepared to email the photos. If you don't have a digital camera, use any camera and get the photos digitized at a local convenience store.
    Posted in Miscellaneous

  • What's on Your Balance Sheet

    Posted on 9/28/2004
    Hard money lenders want to see your net worth to see if you are ready to take on the size loan and project you are requesting. Your balance sheet should contain just two columns - your assets and your liabilities. Simplicity and clarity is the key to creating a good financial package for your loan.
    Posted in Miscellaneous