Avatar's Blog

» Due Diligence Process

Posted on 5/22/2005
Avatar Financial Group does not charge up front fees to review loan packages. A loan package is comprised of color photos of the subject property, perosnal financial statement, P&Ls from the property or other business entity that will support the monthly payemtns for the loan, and, if available, a recent written appraisal of the property. With this information, Avatar is able to make a reasonable determination that the property and borrower meet the criteria for funding. If the answer is 'yes', and the borrower chooses to exercise the Letter of Intent, by signing, only then will Avatar request a down payment toward the third party costs of due diligence.

The due diligence process includes a site inspection by an Avatar representative, usually the president or CEO will personally make that visit and, if possible, meet with the borrower as well. An Avatar appointed appraiser will determine the quick-sale value of the subject property. This is not a traditional complete appraisal. Rather, it is a determination of the price Avatar can expect in the event that the loan defaults and the property needs to be sold on short notice. This will be the value on which the loan amount will be determined.

Finally, a review of financial documentation, legal, and escrow work will be completed and the loan will be funded.
Posted in Miscellaneous