{"id":374,"date":"2010-10-31T15:28:01","date_gmt":"2010-10-31T22:28:01","guid":{"rendered":"http:\/\/privatemoneysource.com\/blog\/?p=374"},"modified":"2010-10-31T15:28:01","modified_gmt":"2010-10-31T22:28:01","slug":"private-loan-packaging-guidelines","status":"publish","type":"post","link":"https:\/\/privatemoneysource.com\/blog\/?p=374","title":{"rendered":"Private loan packaging guidelines"},"content":{"rendered":"<p><em>Clay Sparkman<\/em><\/p>\n<p>One of my long term objectives with this blog is to eventually walk with you through all of the private money loan processes and procedures, from the moment of conception until death (death of course not being a bad thing in my chosen metaphor, but simply meaning loan payoff, workout, or foreclosure).<\/p>\n<p>This post deals specifically with the loan packet submission process (not quite conception, but in the early infancy stages you might say).\u00a0 When working with either brokers or borrowers, it is very important to be specific regarding precisely what items are needed in order to properly review the loan in detail.\u00a0 Presumably at this point, you will have reviewed the loan in concept, via a verbal interview or some form of written summary or submission and would like to take the next step and review a detailed paper (or electronic) packet.<\/p>\n<p>It is also important at this point to very clear with brokers or borrowers regarding how and where and in what form to submit the packet, and if you require a deposit, as we generally do, this would be the time to ask for it.<\/p>\n<p>And so, these are the guidelines used by my company, Fairfield Financial.\u00a0 We have developed these over the years and they are pretty good, but keep in mind that these are only guidelines and that each situation is unique and may require additional underwriting items that are not mentioned here.\u00a0\u00a0 Also keep in mind that there is an element of style or expectation involved here, specific to the individual lender.\u00a0 Our goal is to attempt to obtain all information that might have more than a negligible impact on the decision process.\u00a0 You want to be thorough, but you don&#8217;t want (I think) to ask for every possible imaginable item.\u00a0 (That would make you too much like a bank now, wouldn&#8217;t it?)<\/p>\n<p><strong>When submitting a loan proposal, please include:<\/strong><\/p>\n<ul>\n<li>Residential loan application (1003) or equivalent (MUST      BE SIGNED BY BORROWER)<\/li>\n<li>Signed and completed <a href=\"http:\/\/www.privatemoneysource.com\/downloads\/disclosures.pdf\">Fairfield Disclosure Forms<\/a><\/li>\n<li>Current tri-merge credit report (if loan is submitted      by broker; if borrower submits directly, Fairfield will pull report)<\/li>\n<li>Trio of subject property (or other type of detailed      spec summary)<\/li>\n<li><a href=\"http:\/\/www.privatemoneysource.com\/articles\/comps.php\">A good comp set<\/a>, appraisal, or some other objective and      transparent case for value<\/li>\n<li>Photo(s) (if not included in an appraisal)<\/li>\n<li>Cover sheet describing\/summarizing parameters of loan<\/li>\n<li>Preliminary Title Report(s) for all properties<\/li>\n<li>Payment history on all loans encumbering the subject      property (or properties)<\/li>\n<li>Payoff quote on present loan(s)<\/li>\n<\/ul>\n<p><strong>If borrowing entity is corporation<\/strong><\/p>\n<ul>\n<li>Company financials (income statement and balance sheet)<\/li>\n<\/ul>\n<p><strong>If purchase<\/strong><\/p>\n<ul>\n<li>Valid executed earnest money agreement (contract to      purchase)<\/li>\n<\/ul>\n<p><strong>If credit history is rough<\/strong><\/p>\n<ul>\n<li>Explanation of circumstances<\/li>\n<li>Supporting documentation to show status of resolved      items<\/li>\n<\/ul>\n<p><strong>If present loan is in default<\/strong><\/p>\n<ul>\n<li>Explanation of circumstances<\/li>\n<\/ul>\n<p><strong>If raw land or builder ready lots<\/strong><\/p>\n<ul>\n<li>Supporting documentation (government      correspondence\/code) to address development plan and demonstrate      likelihood of completing development according to plan<\/li>\n<li>Copy of zoning documentation and explanation of      possible land uses<\/li>\n<li>Description and status of utilities and access to the      lots<\/li>\n<li>May want signed affidavit from Borrower regarding      completion status of lot(s)<\/li>\n<\/ul>\n<p><strong>If floating home<\/strong><\/p>\n<ul>\n<li>Copy of registration<\/li>\n<li>Recent float survey<\/li>\n<li>Copy of lease (if slip is leased) or owners certificate      (if slip is owned)<\/li>\n<\/ul>\n<p><strong>If leased land<\/strong><\/p>\n<ul>\n<li>Copy of lease on land (or usage permit)<\/li>\n<\/ul>\n<p><strong>If 2nd or subordinate position loan<\/strong><\/p>\n<ul>\n<li>Copies of notes and Deeds of Trust for all superior      loans<\/li>\n<li>Payment histories and statements for all superior loans<\/li>\n<li>Payoff statements for all superior liens<\/li>\n<\/ul>\n<p><strong>If construction\/rehab loan<\/strong><\/p>\n<ul>\n<li>Summary of project<\/li>\n<li>Builder credentials<\/li>\n<li>Copy of contractor&#8217;s License, bond and insurance<\/li>\n<li>Detailed line item budget<\/li>\n<li>Supporting documentation to backup detailed line item      bids\/estimates<\/li>\n<li>Plans (if floor plan is new or changing)<\/li>\n<li>Copies of permits already obtained<\/li>\n<\/ul>\n<p><strong>If Income Property<\/strong><\/p>\n<ul>\n<li>Copies of all leases and rental agreements pertaining      to the property.<\/li>\n<\/ul>\n<p><strong>Our Guidelines:<\/strong><\/p>\n<p><strong>Region:<\/strong><\/p>\n<p>Alaska, California, Colorado, Florida, Idaho, Georgia, Montana, Nevada, New York, Oklahoma, Oregon, Texas, Washington, and Wyoming<\/p>\n<p><strong>Loan Amounts:<\/strong><\/p>\n<p>$50,000 minimum, no maximum<\/p>\n<p><strong>Interest Rates:<\/strong><\/p>\n<p>10 &#8211; 15% on firsts<\/p>\n<p><strong>Term of Loans:<\/strong><\/p>\n<p>1 &#8211; 5 years<\/p>\n<p><strong>Amortization:<\/strong><\/p>\n<p>Interest only<\/p>\n<p><strong>Broker Fee:<\/strong><\/p>\n<p>Typically 5%<\/p>\n<p><strong>Other Fees:<\/strong><\/p>\n<p>Document preparation: $675 to $2,900; Collection account set up: $470 plus $1 for each $1000 of the loan amount; Property inspection: generally $250 to $1000<\/p>\n<p><strong>Pre-pay Penalties:<\/strong><\/p>\n<p>None<\/p>\n<p style=\"padding-left: 30px;\">&#8212; Clay (clay@privatemoneysource.com, 503-476-2909 or 800-971-1858)<\/p>\n<p><em>Clay is Vice President of Fairfield Financial, a primary source for private money loans since 1964.\u00a0 Fairfield works with a broad range of private money investors, in a broker capacity, finding, underwriting, presenting, closing, servicing, and when necessary, assisting in the workout of difficult loans.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Clay Sparkman One of my long term objectives with this blog is to eventually walk with you through all of the private money loan processes and procedures, from the moment of conception until death (death of course not being a bad thing in my chosen metaphor, but simply meaning loan payoff, workout, or foreclosure). This [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_s2mail":""},"categories":[7,8,9,15,19,22,23,1,28],"tags":[40,41,42,44,49,50,51],"_links":{"self":[{"href":"https:\/\/privatemoneysource.com\/blog\/index.php?rest_route=\/wp\/v2\/posts\/374"}],"collection":[{"href":"https:\/\/privatemoneysource.com\/blog\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/privatemoneysource.com\/blog\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/privatemoneysource.com\/blog\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/privatemoneysource.com\/blog\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=374"}],"version-history":[{"count":0,"href":"https:\/\/privatemoneysource.com\/blog\/index.php?rest_route=\/wp\/v2\/posts\/374\/revisions"}],"wp:attachment":[{"href":"https:\/\/privatemoneysource.com\/blog\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=374"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/privatemoneysource.com\/blog\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=374"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/privatemoneysource.com\/blog\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=374"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}