By Brian Walker
Play by Private Lending’s Rules ivate Lendi R l s
President and CEO
Walker Commercial Funding
Learn how to handle the differences of financing with hard-money lenders
Few institutional banks have funded large commercial proj- ects in the past two years. Most
banks have even stayed away from simple income-producing property loans.
This leaves many investors looking to
finance commercial deals with nowhere
to turn but private lending. In this environment, it’s critical for commercial
mortgage brokers to understand the
differences between institutional and
private-funding business models.
Without institutional funding available,
brokers must introduce seasoned developers and commercial property owners
to the private funding world. Fortunately,
private lending is actually simpler and
more efficient than traditional institutional banking. There are several key
differences that anyone seeking private
financing should know, however. Brokers
should keep in mind the following when
working with private-lending deals:
1. Private funders usually have their
own idiosyncrasies. For example,
a funder may only be interested in
hospitality projects in Costa Rica,
Mexico and Panama, because it
knows the area and is comfortable
• Send in a file missing relevant information. It is impossible for any
funder to render an intelligent decision without all the facts. Files submitted without full financials and an
accurate and compelling business
plan get turned down. That digital
submission represents the project,
property and developer as a whole.
Don’t be sloppy.
• Dictate your compensation terms.
Most private-money funders will let
you make a reasonable amount for
bringing the transaction for ward in a
professional manner, but demanding
an unreasonable amount likely could
kill your transaction. •
Brian Walker is president and CEO of Walker
Commercial Funding, an international financial
intermediary for all types of commercial
projects, properties and in-ground asset funding. Reach him at (281) 964-8037 or brian@
walkercf.com. For more information, visit the
company’s website at www.walkercf.com.
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