A self-employed businessperson used a private money loan to buy a Palm Springs second home through First Capital Trust Deeds.
Every month it seems we’re referred an overly qualified borrower with perfect credit who was somehow denied for conventional financing on the purchase of their new property. As was the case with this second home purchase in the Palm Springs area by a professional from Los Angeles.
It’s odd to see so many strong borrowers denied for a mortgage when they have such excellent income and impeccable credit. But, that’s the state of conventional financing market these days. Fannie Mae and Freddie Mac’s loss has become an incredible gain to individual trust deed investors and investment funds, who have been gladly extending credit to many highly qualified borrowers who use private funds to acquire properties.
We prefer the high quality loans that works out for all parties involved. The borrower gets a lower interest rate private money loan for three years, or until they can refinance into a Fannie/Freddie loan. And the trust deed investor gets a low-risk loan to highly qualified borrowers with plenty of protective equity as security.
Private Money Financing Terms:
- $200,000 Loan Amount (60% LTV)
- 8.00% Interest-Only
- 36-Month Term
- 1-Year Prepayment Penalty