Hard Money Lending 101
Use this guide to save time, close more deals and give your client’s loan the best
chance for approval. A well-organized loan summary should include the following
Executive Summary – A concise, but thorough, overview that includes:
• Description of Property & its Estimated or Appraised Value, Square
Footage, Number of Units.
• Loan Amount & Use of Funds – Debt owed/Liens on the property/Cash out?
• Date of Purchase & Price – How much cash has the borrower invested?
• Debt Service – How will the borrower make monthly loan payments? Will it
produce income or is an interest reserve needed?
• Loan Term Requested – Avatar offers loan terms up to 2 years. Payments
are interest only and no prepayment penalties apply.
• Exit Strategy – Renancing? Selling?
• Equity – Avatar lends up to 65-70% LTV on purchases and renances on
income producing commercial properties. Avatar requires borrowers to
have a minimum of 20% equity in their projects. Some secondary nancing
• The Story – Why are you seeking hard money rather than conventional
nancing? What ‘skeletons in the closet’ or ‘bumps in the road’ does Avatar
need to know about in order to provide you with a quick, reliable answer?
Color Photos of the Property and/or Appraisal – At least three shots each of
interior, exterior and the neighborhood. Avatar does not require a current
appraisal to review the loan.
Operating Income (P & L) – Most recent 2 years on the subject property;
summary of lease agreements and rent roll. If owner occupied, provide
operating statement from the business.
1003 Loan Application or Personal Financial Statement on the
Upon receipt of the above items, Avatar can issue a Letter of Intent/Term Sheet
within 24 hours. Email your submissions to loans@avatar nancial.com.
If you have questions about a loan, please call us at 866.880.0079 or visit us online at www.avatar nancial.com.
A different kind of loan. A different kind of lender.