Beware Of Rates That Are Too Good To Be True

Brenda Sigurdson / July 17, 2019 / Leave a Comment

Hard Money Rates

In our last blog – “Tips On How To Choose A Hard Money Lender”, we touched on money lenders who are promoting low interest rates and to be wary of these lenders. In this blog, we are going to go a little more in-depth on this topic.

Hard Money Loans are for real estate investors who either don’t have a great credit score and/or need money fast and don’t want to go through the red tape that a traditional lender would need to qualify them for a loan. Because of these parameters, the Hard Money Lender is going to charge higher interest rates. The typical interest rate on a hard money loan is 8%-14%. If a lender is promoting rates starting at 5.99% rate, then you will be finding yourself having to qualify for the rate with a strong credit score and other qualifying factors of a traditional lender.

Even though their advertisement isn’t “false” it is a technique to get you in the door and sell you on a loan with higher rates and terms.

Hard money borrowers secure their loans through the equity in their property rather than creditworthiness. That’s why these types …

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Tips on How to Choose a Hard Money Lender

Brenda Sigurdson / June 20, 2019 / Leave a Comment

What is their reputation?

When choosing a bridge/hard money lender, one of the most important (if not the MOST important factor) is the reputation of the Lender. Over the past 3-5 years there has been a vast increase in the number of hard money lenders and not all of them have the greatest track records.
A great place to begin searching might be to ask friends, colleagues, fellow investors of any Lenders to avoid. With the sheer number of banks/lenders out there, it may be difficult to narrow your search down, but if you know which Lenders to avoid from the beginning, you will have a head start in your search. By the same token, friends, colleagues and fellow investors may already have worked with a lender or two that they highly recommend. The key here is to narrow your search down to a handful of lenders who are known to get deals closed so you don’t waste your time with an unknown commodity.

How long have they been in business?

As previously mentioned, there has been a great increase in the number of bridge/hard money in the past 3-5 years. Quite frankly, this just isn’t long enough to develop …

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$1,900,000 Blanket Mortgage – Mixed-Use Development & Three-Family Investment Home – Multiple Locations

Rich Salinaro / April 8, 2019 / Leave a Comment

$1,900,000 Blanket Mortgage – Mixed-Use Development & Three-Family Investment Home – Multiple Locations

One of H&O Capital Funding’s repeat borrowers reached out in the midst of the shut down around the tri-state area due to Covid-19. The borrower had been working on the construction of a mixed-use property with two stores and eight apartments in Bayonne, NJ. The property was a single story retail property when he purchased it in 2016. Over the past 3.5 years the borrower applied for, and was granted, permits to add 3 stories to the building with 8 apartments in total. He received a loan at the time of purchase, but the note came due and the lender was no longer lending due to Covid. In a bit of a panic, the investor reached out to H&O Capital to secure a short term loan to allow him to finish the project and stabilize the building before he switched to a conventional loan. Because the as-is value of the project was a bit low to support the loan, the borrower used a property he owns in Yonkers, NY as additional collateral to get the deal done. Now the borrower has the time and funds to …

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$350,000 First Mortgage – Mixed-use property – North Bergen, NJ

Rich Salinaro / April 5, 2019 / Leave a Comment

$350,000 First Mortgage – Mixed-use property – North Bergen, NJ

H&O Capital Funding was approached by this borrower looking to borrow some funds to help cover some of his costs on another deal he was working on. The biggest issue was the timing as he had to close in under two weeks so that he didn’t lost the other deal he was pursuing. H&O Capital Funding stepped up to get the borrower cash he needed to close on his other deal in just over a week.

H&O Capital Funding has helped countless real estate buyers, sellers, lessees and lessors achieve their goals. Our legacy is unwavering commitment to the communities we serve. Houlihan & O’Malley Commercial Real Estate Services specializes in four distinct, yet overlapping, areas of business: Commercial Brokerage services, Private Mortgage services, Appraisal Services and Advisory services.

For more information on loans that we offer, visit our website.

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When is it best to go to a Private/Hard Money Lender for your real estate investment?

Brenda Sigurdson / April 2, 2019 / Leave a Comment

You Need Immediate Financing/Quick Turnaround

Private Lenders (Hard Money and Bridge) can close deals within 3-4 weeks as opposed to the 90-120 days it takes conventional lenders. Some private lenders, like H&O Capital Funding, have even closed deals in a week or less.

Cash, no contingencies, 30-days to close purchases are perfect deals for a Private Lender to step in and provide bridge financing until the borrower can arrange for permanent financing. Or perhaps you just need to take some equity out of the property for another business opportunity, a private/hard money lender may be the answer.

For private lending customers, speed and flexible financing make up for the typically higher rates/terms that are charged.

Poor Credit

After the financial collapse of 2008, conventional lenders began to take a serious look at borrower’s credit worthiness, no matter how risky or non-risky they thought the loan was. Now some of that has scaled back a bit, but credit worthiness is still a major factor for conventional lenders and even some private lenders, especially the private lenders offering rates similar to conventional lenders. However, there are many private lenders, H&O Capital Funding included, that are strictly asset-based lenders who do not …

When is it best to go to a Private/Hard Money Lender for your real estate investment? Read More »

Houlihan & O'Malley Commercial Real Estate

$265,000 First Mortgage – Two-Family – Bronx, NY

Rich Salinaro / February 19, 2019 / Leave a Comment

$265,000 First Mortgage – Two-Family – Bronx, NY

H&O Capital Funding was approached by this borrower looking to borrow some funds to help finish his renovation of a 3-family dwelling. The only issue was that the Certificate of Occupancy indicated that the property was a 2-family home, not a 3-family. Because of this discrepancy, the borrower could not get conventional financing and needed a lender with the experience and the know-how to help him navigate the department of buildings.H&O Capital Funding stepped up to get the borrower some much needed cash to help him finish the renovation along with some advice as to how to convert the property to a legal 3-family home. H&O Capital was able to close the loan in just two weeks.

For more information on loans that we offer, visit our website.

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Commercial Real Estate Investment Changes in 2019

Brenda Sigurdson / February 15, 2019 / Leave a Comment

Still a Good Investment in 2019?

“Is Commercial Real Estate still a good investment in 2019?” This is a common question we’ve been asked over the past few months. The answer is unequivocally yes, however, as with any investment, you need a sound strategy and to do your homework before buying in. The market has been shifting for some time, specifically the office and retail sectors, as changes in technology influence tenant requirements. Investing in those markets will take careful planning and due diligence, but the rewards can be significant.

Plan your Financial Strategy

As with all investments, you never want to overextend or overleverage yourself, and this is especially true with any real estate investment. The market can change quickly, so it’s important to be positioned where you can absorb a 10-15% temporary dip in both income and value due to an economic downturn. Rates are still very low, so using debt to finance a transaction makes sense, but the key is to find the right balance between debt and equity.

However, Banks are Pulling Back with Commercial Lending

An inverted yield curve, where the yield on short-term treasuries is higher than that of long-term ones, has preceded nearly …

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$285,000 First Mortgage – Freestanding Restaurant Property – Glen Cove, NY

Rich Salinaro / February 5, 2019 / Leave a Comment

$285,000 First Mortgage – Freestanding Restaurant Property – Glen Cove, NY

Another day, another quick closing for H&O Capital Funding! The borrower here got into the restaurant business a few years ago and within his first three weeks there was a fire and the entire restaurant went up in flames. After spending two years, and the majority of his own savings rebuilding the restaurant, the restauranteur and the landlord had a falling out. To make a long story short, there was a court ordered sale of the restaurant from the landlord to the restauranteur. In stepped H&O Capital Funding to get the restauranteur the funds he needed to close on the property. Despite a few hiccups along the way provided by the seller, H&O Capital was able to close the loan in just a month.

For more information on loans that we offer, visit our website.…

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$500,000 First Mortgage – Three-Family plus Office – Yonkers, NY

Rich Salinaro / February 5, 2019 / Leave a Comment

$500,000 First Mortgage – Three-Family plus Office – Yonkers, NY

In this deal, the borrower came to H&O Capital Funding needing a loan to help prevent a foreclosure. The borrower here got into some financial trouble and missed some mortgage payments. He needed a quick loan to stop the foreclosure process while he works on repairing his credit and refinancing with a conventional lender. In stepped H&O Capital Funding to the funds he needed to payoff the current lender to end the foreclosure action. H&O Capital was able to close the loan in just three short weeks.

For more information on loans that we offer, visit our website.

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$1,100,000 First Mortgage – Investment Condo – Brooklyn, NY

Rich Salinaro / February 4, 2019 / Leave a Comment

$1,100,000 First Mortgage – Investment Condo – Brooklyn, NY

This was another unique situation H&O Capital was able to navigate to ensure a deal got done. In this case, the borrower was the lead developer on a large condominium project in the Williamsburg area of Brooklyn. Part of his agreed upon development fee granted him title to 3 of the units in the building once completed. Upon completing the project, the sponsor tried to renege on their promise. The sponsor, with their extremely deep pockets, were able to take two of the three units promised to the developer, but the last one he was able to hold on to.

In stepped H&O Capital Funding to get the developer some much needed cash against the value of the brand new condo unit he planned to rent out. H&O Capital was able to close the loan in just three weeks, despite numerous delays by the sponsor trying to holdup the closing.

$1,100,000 First Mortgage – Investment Condo – Brooklyn, NY Read More »

Beware Of Rates That Are Too Good To Be True

Hard Money Rates

Tips on How to Choose a Hard Money Lender

$1,900,000 Blanket Mortgage – Mixed-Use Development & Three-Family Investment Home – Multiple Locations

$350,000 First Mortgage – Mixed-use property – North Bergen, NJ

When is it best to go to a Private/Hard Money Lender for your real estate investment?

$265,000 First Mortgage – Two-Family – Bronx, NY

Commercial Real Estate Investment Changes in 2019

$285,000 First Mortgage – Freestanding Restaurant Property – Glen Cove, NY

$500,000 First Mortgage – Three-Family plus Office – Yonkers, NY

$1,100,000 First Mortgage – Investment Condo – Brooklyn, NY

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