Avatar's Blog
» Borrower Equity - Where's the Cash?
The biggest stumbling block to purchases of commercial real estate property when using hard money funding is the borrower equity portion of the project. Avatar requires borrowers to have a minimum of 20% cash equity on the table at closing. Avatar will lend up to 65% of the purchase price and the balance can come from a Seller Carry-Back loan or similar subordinated loan. If you are bringing a solid 30%+ to the table to buy a commercial property, Avatar may 'stretch' to meet you and supply the balance of the funding required to complete the purchase.
When presenting your loan package to Avatar, be sure to include proof of the location of the funds you will be using at closing. This will separate you from the many people who make loan requests are not serious buyers - they have no capital to put down to make the project a reality. Real borrowers/buyers have cash to invest and are ready to meet the requirements of hard money lenders for their portion of the equity.
