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Tuesday, March 11, 2014

Private Money USA Commercial Loans From $100,000 to $2.5MM

We make slightly scratched and dented commercial loans....

Is your client's commercial property partially vacant? Do you need a lender who will allow the seller to carry back a second mortgage? Does your client have a balloon payment coming due on his commercial property? Has your bank offered him a discounted pay-off? Does your borrower have less-than-stellar credit? 

Our new product is a blanket loan against a portfolio of rental homes. Rental homes? Yes, as long as there are at least five homes or units, we consider this to be a commercial loan. We even offer a partial release clause. This loan is ideal for speculators. 

Loan Types for the USA:

Permanent first mortgage loans
Bridge loans in a first mortgage position
Land loans
Sorry, no construction loans
Minimum Loan


Maximum Loan

$1,500,000 (maybe up to $2,500,000)

Acceptable Properties

All standing commercial properties, plus land loans, including:

Retail buildings
Strip centers
Shopping centers
Industrial buildings
Mixed use buildings
Self storage
Assisted living
Residential care homes
Day care facilities
Gentlemen's clubs
Lending Area

Nationwide (Crime rate of the neighborhood must not exceed 125% of the national average)
Amortization -

If the property is less than 50 years old:  30 years
If the property is older than 50 years:  25 to 15 years
Loan Term

1 to 15 years, most typically 3 years to 5 years


2.5 points to 6 points, usually 3.5 points

Prepayment Penalty

Usually none

Application Fees / Upfront Fees


Loan-to-Value Ratio

Purchase money loans:  70%
Refinances:  65%
Land loans: 25% to 50% (usually 40%)
Interest Rate

7.9% to 9.9% in California
10.9% to 13.9% outside of California
Every one of our hard money commercial loans is individually-priced based on the risk, the desirability of the property, and the size of the loan (larger loans are more expensive).

How to Guesstimate Your Likely Interest Rate -

California base rate:  8.9%
Outside-of-California base rate:  11.9%
Start with the base rate for your state and then add or subtract the following.

Subtract 1% if the property is less than 30 years old
Add 1% if the property is 50+ years old
Subtract 1% if the loan-to-value ratio is less than 45%
Add 1% if the loan-to-value ratio exceeds 55%
Subtract 1% if the loan is smaller than $400,000
Add 1% if the loan is larger than $700,000 but smaller than $1MM
Add 2% if the loan is larger than $1MM
Subtract 1% for very attractive properties
Add 2% for properties less-than-average in appearance
Subtract 1% for purchase money loans
Subtract 1% for credit scores of 700+
Add 1% for credit scores between 550 and 630
Add 2% for credit scores below 550
Add 2% to 4% for land loans


Tuesday, February 4, 2014

One-Point Commercial Bridge Loans...?!?!?!?

That's right, we have a one-point bridge loan product for commercial properties:

Interest Rate: 14.9%
Loan Fee: 1 point + $950 (nothing up-front)
Term: Six months
Prepayment Penalty: None
Maximum Loan-to-Value Ratio: 65% (70% on purchases) Properties: Multifamily (5+ units), Commercial, and Industrial

Here are some Frequently Asked Questions:

Q:  Can I use this program to fix and flip houses?
A:  Sorry, but no.  Home loans pay off too quickly to allow us to make any dough.

Q:  Will you lend to foreign nationals?
A:  Yes

Q:  Why is the interest rate so high?
A:  This bridge loan program is designed for borrowers who will only keep our loan for a few weeks or a few months.

Q:  Can I get a 6-month or a one-year extension for a point or two?
A:  It's usually not necessary to pay any extra points.  If the loan goes past maturity, the interest rate simply goes up some.  This way, if your borrower ends up keeping our commercial bridge loan for seven months, he doesn't have to pay some huge extension fee for that one extra month.  We pass the entire interest rate increase on to our private investors, so usually they are quite content to keep receiving payments.

Q:  What types of commercial properties will you finance?
A:   Apartments, office buildings, retail buildings, strip centers, shopping centers, warehouses, industrial buildings, self storage facilities, hotels, motels, office condo's, commercial condo's, industrial condo's, marinas, health care properties, and gentlemen's clubs.

Q:  Will you make your commercial bridge loan as a second mortgage?
A:  We would be willing to consider a commercial second mortgage, but usually the underlying bank would prohibit our second mortgage.  That being said, it wouldn't hurt to ask the underlying commercial bank if it would allow us to make a new commercial second mortgage.

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