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
SOLUTION
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
A & A ADVANTAGE
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
RESULTS
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.