Featured LoanHard Money Bridge Loan In Los Angeles On Fully Renovated Project
Loan Amount: $900,000
Loan-To-Value: 45% LTV
Situation & Challenge
This loan was originally placed with a private money lender whose business model was to originate loans and sell to a secondary market investor (bond fund manager) that allowed that lender to keep making new loans every month. These types of lenders are often called “Conduit lenders.” In early March, FCTD received notice that the conduit lender’s loan buyer in the secondary market stopped buying loans and that they would not be able to fund this loan.
Solution & Result
Fortunately for FCTD and our borrower clients, we’ve built a large network of funding sources, from conduit lenders, mortgage funds where they manage all loans in their portfolios, family offices, real estate offices that switched to lending after the real estate market became too pricey for their business model, and high net worth investors, all of whom can fund loans.
FCTD was able to switch this to a real estate office that funds approximately 10% of FCTD’s loans annually. The real estate office liked the low leverage at 45% TLV and was able to fund the loan within a few days without an appraisal.