PRIVATE
HARD-TO-DO-LOANS AT RATES FROM
12-20%* & 3-10
PTS
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*Interest
rates can exceed 20%. Rates are based on many deciding
factors.
**In many cases.
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With investors located around the world, we
review and consider projects on a Global
basis. However, our
first priority is within the United States and its territories.
The Equity Experts, a special finance consultancy
is dedicated to helping
individuals, entrepreneurs and corporations
to fund those Hard-To-Do-Loans.
With direct private money available
for projects ranging from $50,000 up,
we will work with you
to get your deals funded.
What kind of projects do we like?
• Commercial Acquisitions
• Residential Developments
• Land Acquisition/Development
• Commercial Development
• Residential Investment Properties
WHAT FUNDING PROGRAMS DO WE OFFER?
Unlike traditional lending, private
mortgage/trust deed lending (also known as private equity,
or “hard money” lending)
is the process by which a private investor lends money against
a piece of property and holds a mortgage or deed of trust lien
against that property, much like a bank or mortgage lender.
In most cases, Borrower’s treat
the transaction just exactly like that of a bank loan or
conventional mortgage,
but with a certain ease that is just not available through
traditional lending sources.
OPTION #1: PRIVATE MORTGAGE/DEED
OF TRUST LOAN
Borrower Pros:
• Credit ratings are often insignificant in lieu of strong real
estate assets and a qualified borrower (based on assets, experience
and historical performance).
• Funding can occur in days rather than months
• Interest only payments can be negotiated with some payments
deferred to loan payoff
• Joint venture and/or straight loan programs can be negotiated
• Loans can be as short as 3 months and as long as 5 years (sometimes
longer)
•
Borrower’s enjoy the personal and consistent service
of a professional loan management team rather than the cold
distance of a payment coupon book.
Borrower Cons:
• Typical loans have larger transaction fees, higher interest
rates and tougher default terms
• Borrower can default resulting in foreclosure of property more
quickly
• Late fees, default fees and foreclosure fees are typically
much more expensive
• Loan-To-Value ratio(s) are much more stringent than most conventional
loans
• All closing, management and other related fees are the responsibility
of the borrower
•
Loan will typically require 6-12 months of guaranteed payments,
no matter when refi’d
Typical Loan-to-Value ratios for Real Assets acting as Investment
Security:
(Loan to value or LTV is the maximum amount we will loan against
a property's verifiable value or purchase value, whichever
is less.)
Commercial: 65%
RawLand: 50%
Construction: 65%
Development: 50-65%
Income-Producing Commercial: 70%
Residential Investment 70%
How it works:
After thorough due-diligence on a loan request and the borrower,
we submit a summary of the loan and the borrower to our investors
for acceptance. Once the investor(s) have committed to fund,
our team then sets up an escrow through a third-party firm,
completes all legal paperwork, helps with the final signing
and then services the loan. Your monthly payment will be written
directly to a collection account managed by a company who specializes
in managing escrow and mortgage payments.
All fees are paid by the borrower for the life of the loan.
OPTION #2: JOINT VENTURE
Unlike our previous investment programs, the joint venture
investment option is perhaps one of the most variable of options
for a Borrower.
In the case of a JV transaction, the Investor funds a loan/financing
request for a lesser interest return on principal plus an ownership
stake in a real estate property/project.
Although the terms on such transactions will vary according
to the details of each opportunity, we typically attempt to
arrange the following terms :
This is an illustration only, and cannot be construed as an
absolute model for every JV investment:
Project: Housing development (55+), 720 units
Project End Value (projected): $210,000,000
Projected End Value Net Profit: $ 60,000,000
Investment Requested: $ 10,000,000
Ownership Share for JV capital: 70%
Buildout schedule: 7-10 yrs.
Return: Year 1-4 : Repayment of principal investment + 10%
interest
Add'l years: 70% of Net Return
Total Return:
$10,000,000 Principal, plus 10% interest on unpaid principal
until paid back; plus
$32,000,000 Ownership share of Net profit
Avg. Annual ROI (based on 10 yr. Build out & 10% interest
over 4 years) 36%
Pros:
• Higher cash involvement from investors
• Lower interest rates, often deferred to exit of principal payoff
• Management help/oversight by professionals
• More negotiable terms
• Credit/Refi support for future take-out loan(s)
Cons:
Only qualified borrower/partners considered to be an investment
opportunity
• Market variability
• More cost related to funds borrowed
• Outside interference/cooperation with project
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