Investors used an 80% LTV hard money bridge loan from First Capital Trust Deeds to acquire and stabilize Orange County investment property. The out of state buyers planned on using the hard money loan for 5-6 months, or until after they renovated the home and personal income taxes were filed showing the rental income generated from this property, which could then be used to qualify for a jumbo mortgage for this investment property.
FCTD sees cases like this where buyers need to use short-term bridge financing to acquire, renovate, and stabilize (install a tenant) the home before taking out long-term permanent financing.
In this case, the buyers were acquiring the property at a significant discount because the home needed about $75,000 in updates to fully maximize the value of the property. So the $880,000 purchase price was just a temporary value. In the meantime, they used the 12-month bridge loan to quickly acquire the home and get the ball rolling.
80% LTV Hard Money Bridge Loan Terms:
- $700,000 Loan Amount (80% LTV)
- 11.00% Interest-Only
- $6,416/Month Payment
- 12-Month Term
- No Prepayment Penalty