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Only 1.125% over bank rate with 100% less hassle - case study

Case Study for Hard money Lender

The Difficulties With the Loan

Borrower had good credit and good income, but income

was difficult to document based on being self-employed.

Borrower owned businesses as well as additional investment

properties. Cash reserves demanded by institutional lender

were very high and not possible.

  • Borrower already owned multiple investment properties, had an SBA loan, as well as other conventional and VA loans.

  • The conventional loan he was approved for originally required 12 months reserves on subject and 6 months on all other properties

  • Less than 30-day close of escrow

The Overview of the Loan Scenario

Borrower wanted to purchase investment property with

conventional financing with 20% down payment. Was

conditionally approved by “A-paper” bank, with difficult to

obtain documentation and reserves. Notice to Cure had

been issued three days prior to COE.

  • Good Credit

  • Investment Property Purchase

  • Self-Employed


Avoid the 3-day cure notice that was issued three days prior to the COE. A lengthy full documentation loan on a difficult financial scenario had taken a considerable amount of the contract period and instead closed rapidly on a hard money loan only 1.125% from the original “a-paper bank” loan.

  • $350,000 Loan Amount

  • 10% note rate, APR 11.35%

  • 2-year Interest Only Loan

  • Close in one week


With in-house underwriting and utilizing our own funds we’re able to better control and accelerate the pace of a transaction

  • Fast Closing

  • Note rate very close to conventional financing rate

  • Minimal Documentation

  • No Appraisal


A & A Funding was able to close this loan on time and avoid having the borrower lose their earnest money while providing a loan with a rate only slightly higher than conventional lending.

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