Looking for hard money commercial lender - Posted by Sam

Real Estate Investing Real Estate Financing
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Posted by Ben Carmona on July 27, 2007 at 16:57:54:

They are relative to hard money lenders which is what you asked for.

I guarantee you wont find a lender out there that doesnt ask some of these same questions. In lieu of deleting some of the ones that applied to residential hard money, I just sent all of them. Sending an email like this with questions also helps me guage how interested a client really is with seeking help. It baffles me how many people look for financing but fail to realize professionals need as much information as possible to help direct prospects in the right direction.

Good luck. We’ll be waiting for your post on how you got this done.

Ben Carmona

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Looking for hard money commercial lender - Posted by Sam

Posted by Sam on July 26, 2007 at 16:16:21:

I have a 66 acre waterfront lot in Eufala, Alabama in contract, and I am looking for a lender who will be able to finance the development and purchase of the land. The reason I need a hard money lender is because the closing date is August 21, 2007 and a normal lender would take too long for closing. The purchase price of the property is 2.65 million and construction cost that needs to be financed is 4.4 million. So I am looking for a total loan of 7.05 million in financing with a minimum of 24-36 month term. Financing is only required for part of phase I of this project. After which the property will be paid off with extra funds to finish the rest of the project.
The project will consist of 2 phases.

Phase I.
Development of the 12 acres of the waterfront property with 52 residential units directly facing the water and 34 residential units directly behind these.

Cost to build is $112,500 per unit with sales being 250,000 per unit for the 52 units facing the waterfront, and 225,000 per unit for the remaining 34 units.

20,650,000 total sales
9,675,000 total construction cost(including soft costs)
826,000 Realtor fees (4%)
1,900,000 Finance Costs (12% interest 24 months, 3% origination)
2,650,000 Land Cost
5,600,000 Profit

34% Loan to Future Value(only for Phase I, this does not include the rest of the 51 acres)
Finance cost is if there are no sales during the construction period.

Phase II.
This will include the development of the rest of the 54 acres of land.

I need a lender that can close quickly. Closing needs to be on August 21, 2007 or sooner. Please contact me either via email or at 253-230-0274.

Sincerely,
Sam

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Re: Looking for hard money commercial lender - Posted by Joe Alonso

Posted by Joe Alonso on August 01, 2007 at 21:24:08:

No matter how you slice it, you need skin in the game. Unless you are an experienced developer with a track record (and you may be) that can get a JV situation in place, you need to show ANY investor that you, too, believe in the project by putting YOUR money in it.

If the seller of the parcel wants to JV with you, we can use equity from the land to offset injection of funds. There are creative ways to get this done, but you must be open to an equity participation. You simply can’t have your cake and… well, you know.

Joe Alonso
www.fwdcap.com

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Re: Looking for hard money commercial lender - Posted by Tom Resner

Posted by Tom Resner on July 27, 2007 at 09:52:49:

I work with several land development HML’s. Call 866-776-2915 if you would like me to help.

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Re: Looking for hard money commercial lender - Posted by Ben Carmona

Posted by Ben Carmona on July 26, 2007 at 19:25:30:

Sam,

How much are you investing into this yourself? Do you have other collateral?

Ben Carmona

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Re: Looking for hard money commercial lender - Posted by Sam

Posted by Sam on July 26, 2007 at 20:48:31:

Ideally, we would like to put nothing into the project because of the low loan to future value. A personal guarantee could be signed, a personal financial statement will be available for any serious lender that has a program that fits this loan/timeframe. If our own cash has to be thrown into the project, let us know how much you would us to put down in order to make it work.

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Re: Looking for hard money commercial lender - Posted by Ben Carmona

Posted by Ben Carmona on July 27, 2007 at 05:29:47:

My experience is mostly with residential rehabs up to about $500,000. From time to time a client will ask about larger projects such as yours, of the 40+ lenders I’ve spoken with and refer to, none of these will do such large deals without some type of “skin in the game”. What that is seems to be different with each.

I’ll send you over the list of questions I usually ask to determine which lenders to speak with.

Ben Carmona

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Re: Looking for hard money commercial lender - Posted by Sam

Posted by Sam on July 27, 2007 at 11:51:48:

I am actually a mortgage broker that also does residential, the questions you asked me aren’t relative to a commercial loan like this.