Hard Money Lending Still an Option with H&O Capital Funding LLC

Brenda Sigurdson / April 7, 2020 / Leave a Comment

With the threat of COVID-19 on the rise, the world is facing trying times, and this has caused many lenders to start reducing their offerings or simply put a pause on lending altogether. However, we understand that there is still a need for quality lending to be made available, which is why H&O Capital Funding LLC is still active. Given the state of the economy, it is entirely understandable that many people have a need for liquidity today and we want to be able to help. We’ve worked to streamline our process, which will help move things along in what has become a tough environment to get deals closed.

Over the many years that we’ve been in business, we’ve been committed to providing help for our customers when they need it. Whether it is a commercial real estate investor in need of financing, appraisal services, advisory, or brokerage services, we have the knowledge and experience to help. If you are looking for hard money loans and need a lender, we could be the ideal solution for you during these strange days where so many other lenders have shuttered their services entirely.

There Are Still Opportunities on the Market

While the …

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Collateral Asset Valuation and How It Works

Brenda Sigurdson / January 31, 2020 / Leave a Comment

Nearly all lending involves some sort of collateral that the borrower allows the lender to place a “lien” on. A lien is a legal instrument of record, which ties up the collateral so that it may not be sold, refinanced or transferred without the debt first being paid. Depending on the type of loan you are looking for, some lenders will be more specific about what collateral they need, while others may just request a certain dollar amount, and accept it in any form of asset that you have available.

Essentially, collateral gives the lender recourse if you don’t pay. In hard-money lending, the collateral is real estate of some sort, whether it be land, residential, retail, etc.

Where Asset Valuation Comes into Play

When a non-cash asset is being used for a loan or line of credit, it has to be of a certain value. Offering someone the title on a $50,000 property in exchange for a $450,000 loan, for example, will not cut it. To get approval for the collateral that is put forth, it must be valued appropriately. Asset valuation is a simple process where the lender will determine the exact value of whatever asset you put …

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$300,000 Second Mortgage – YMCA – Tarrytown, NY

Rich Salinaro / November 18, 2019 / Leave a Comment

$300,000 Second Mortgage – YMCA – Tarrytown, NY

H&O Capital Funding recently closed a second mortgage for the YMCA of Tarrytown. The Y had to make some much needed repairs and needed a quick cash infusion to get it done. H&O Capital was able to get it done in under two weeks, allowing for the YMCA to make the needed repairs before the winter sets in.

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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The Hard Money Closing Process

Brenda Sigurdson / October 23, 2019 / Leave a Comment

Hard money loans offer a quicker transaction than you’d get with conventional mortgage lending. The requirements for a loan are simple, as well, and the closing process is typically going to be much easier because there is much less paperwork involved. In order to make sure that the process goes as smoothly as possible, you should prepare yourself and know what to expect at the closing table.

The hard money closing process can involve the following types of documentation:

Promissory Note

This is a simple agreement of the payment terms of the loan, including dates and amounts of payments agreed upon. There will also be rules regarding how the trustee operates on both the lender and borrower’s behalf. It is essentially an IOU from the borrower to the Lender.

Mortgage

Often, people refer to a loan as a “mortgage,” but a mortgage is not actually a loan. The mortgage is a contract between the borrower and the investor, which pledges the property as collateral or security for the loan.

Closing Statement

This statement is required by federal law, and will disclose all of the fees and costs associated with the transaction. It is designed to make sure that all payments, …

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Conventional Lender Loan Process vs. Hard Money Lender Loan Process

Brenda Sigurdson / September 17, 2019 / Leave a Comment

If you are ready to invest in Commercial Real Estate, you need to look into the best way to finance your investment. On the debt side, there are typically only two options available, a Conventional Mortgage or a Hard Money Loan. Below you will find information on the process of these options.

Applying for a conventional mortgage can be a slow and arduous process requiring much documentation. At the other extreme, you might be able to secure a hard-money loan in days without producing copious financial information, especially with a strong asset because they are lending on the property equity and not the borrower’s credentials.

Conventional Mortgage

In general, banks and lenders will require you to meet these commercial real estate loan qualifications:

Up to five years of tax returns.
Your books, records and financial reports for up to the last five years or since inception, whichever is shorter. Will include off-balance-sheet financing, such as leases.
Projected cash flows for the life of the loan.
The credit reports of the business and all owners/partners.
Your state certification as a corporation or limited liability entity.
A third-party appraisal of the property.
A business plan that explains how the property will be

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$1,700,000 Blanket First & Second Mortgage – Mixed-Use Property & Development Piece – Westfield, NJ

Rich Salinaro / August 2, 2019 / Leave a Comment

$1,700,000 Blanket First & Second Mortgage – Mixed-Use Property & Development Piece – Westfield, NJ

The borrower in this deal is a developer who has done a lot of work in Northeast New Jersey. Having hit a few roadblocks with his conversion of a vacant property from office to residential use, he needed some funds to pursue the issue with the town. A vacant property without the approvals for redevelopment isn’t very marketable and most lenders were stymied trying to underwrite the deal. H&O Capital, however, was able to determine that there was enough equity behind a first mortgage on a mixed-use property the borrower owned in the same area. H&O did the deal as a blanket to make it work. There were a number of moving pieces here, but H&O was still able to get the deal closed in just three weeks.

For more information …

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$550,000 First Mortgage – Mixed-Use Building – Brooklyn, NY

Rich Salinaro / July 26, 2019 / Leave a Comment

$550,000 First Mortgage – Mixed-Use Building – Brooklyn, NY

In this deal, the borrower came to H&O Capital Funding needing some money to finish up some renovations he was doing to his property in the Clinton Hill . The property consisted of two apartments and one commercial space that was divided into 3-4 smaller spaces for separate tenants. With plenty of value in the property, the loan was a no-brainer for H&O Capital Funding. Despite a few legal hurdles, the loan closed in under three weeks.

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

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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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$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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Who Funds Hard Money Lenders?

Rich Salinaro / December 14, 2017 / Leave a Comment

Where do Hard Money Lenders get their Funding?

Hard Money Lender funds come from one of three sources. Personal funds, a portfolio of investors or a public fund with money raised from many different investors similar to a REIT.

The first, a lender who uses personal funds, is likely the rarest. There simply aren’t that many lenders out there with enough personal funds to meet the demand for their service.

The second, a lender who has a portfolio of investors for each deal, is fairly common. These lenders generally have a pool of investors they can bring each deal to. The investors will then decide whether or not to invest in the deal as presented by the lender. Some lenders who use this method can have trouble raising funds for certain deals and may make promises to a borrower that they can’t keep. However, most of these lenders have investors who trust their judgement and jump at the chance to invest in any loan the lender brings them.

The third, a lender who raises funds from many different investors to create a pool of money or “fund” that they then lend out of. These lenders are becoming more and more …

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hard money lender