http://privatemoneysource.com/blog/uncategorized/twenty-five-questions-you-must-ask/ Fri, 13 Jan 2012 18:52:14 -0800 http://wordpress.org/?v=2.8.4 hourly 1 http://privatemoneysource.com/blog/uncategorized/twenty-five-questions-you-must-ask/comment-page-1/#comment-15 admin Fri, 25 Sep 2009 18:44:57 +0000 http://privatemoneysource.com/blog/?p=89#comment-15 Indeed this is a critical factor in the decision to invest or not invest. It is probably worth noting that there are a few things an investor can look for in a loan to mitigate this type of risk. (1) An nvestor should ask to see any documentation/evidence demonstrating that either the borrower qualifies for the take-out loan program they plan to utilize or (in the event that the property is to be sold) that the unit(s) to be sold fit into a lending program that is likely to work for and appeal to the target borrower(s). (2) Keep the LTV down. As long as the LTV is not too high, there is always another private money lender willing to refi the loan. And (3) Make sure that the borrower is financially solid enough to maintain payments should the initial plan not work out, and be prepared to offer an extension to carry the borrower through. A good borrower always has a contingency plan. A great borrower always has several. Indeed this is a critical factor in the decision to invest or not invest. It is probably worth noting that there are a few things an investor can look for in a loan to mitigate this type of risk. (1) An nvestor should ask to see any documentation/evidence demonstrating that either the borrower qualifies for the take-out loan program they plan to utilize or (in the event that the property is to be sold) that the unit(s) to be sold fit into a lending program that is likely to work for and appeal to the target borrower(s). (2) Keep the LTV down. As long as the LTV is not too high, there is always another private money lender willing to refi the loan. And (3) Make sure that the borrower is financially solid enough to maintain payments should the initial plan not work out, and be prepared to offer an extension to carry the borrower through. A good borrower always has a contingency plan. A great borrower always has several.

]]> http://privatemoneysource.com/blog/uncategorized/twenty-five-questions-you-must-ask/comment-page-1/#comment-13 arthur Thu, 24 Sep 2009 23:56:39 +0000 http://privatemoneysource.com/blog/?p=89#comment-13 Point No. 12 seems all important now and the reason many lenders are not lending. The usual exit strategies of re-financing or selling are so severely diminished as to make one wonder how a balloon loan will ever pay-off. Point No. 12 seems all important now and the reason many lenders are not lending. The usual exit strategies of re-financing or selling are so severely diminished as to make one wonder how a balloon loan will ever pay-off.

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