Clay Sparkman and Kris Gilmore
Between phone calls, emails, and on-line submissions, most private money lenders/brokers/sources receive a tremendous number of loan requests. It’s pretty common for these loans to have tight deadlines, and so we’d like to suggest three ways to speed up the process when you are submitting a private money loan request for review and approval.
1) If the company offers an on-line proposal form (and many do), consider using it. By using the online form provided by a company, you have the best chance of meeting their own particular needs and requirements. It is so much easier if you hit the mark with your initial request, providing all the applicable information for the high level analysis and response. Fairfield has an online form and we are always pleased when brokers and borrowers choose to use it. Our form can be accessed through our web-site or by going directly to this link. This simple form often provides us with everything we need to know to issue a quote. It’s very effective.
2) Leave a description of the loan transaction in a voice mail. We’ve spent days playing phone tag with brokers, only to find out that they were looking for a loan in a state that we didn’t lend in. If we get a detailed voice mail, and have to leave a message back, we can still make progress and answer some questions that will help speed up the process.
3) Send an email with a summary of the loan. This can be an efficient way to submit a loan request, and most lenders can evaluate a good summary very quickly. However, if critical information is lacking or hard to find, it will delay the process, so be thorough in providing a high level summary. Generally a good summary is not more than 1-2 pages, and is very much in the nature of an executive summary. At Fairfield, We’re looking for an outline of the loan request, not pages of reading material. Here’s a list of information that we like to see:
The Property
- Property address
- Specs on the property (property type, Square footage, # of units, NOI, etc…)
- Property condition
- Purchase price amount owed
- As-Is value and ARV
- Amount needed for repairs (if applicable)
- Amount of money invested so far
The Borrower
- Monthly income
- Net worth
- Credit score
- Reasons for credit issues (if there are some)
- Relevant experience
The Loan
- Broker fees
- Net amount of funds required by the borrower
- Amount available for down payment
- Use of funds
- Closing deadline
- Requested term
- Exit strategy (This is very important with private money since it is only a bridge.)
A good summary should highlight the features of the loan without the reader having to hunt for information. By providing this information in a clear concise format, you will facilitate the process and ultimately be able to either close loans faster or get to “no” sooner (if that should be the case)—and either way, faster is better.
— Clay (clay@privatemoneysource.com, 503-476-2909)
Clay is Vice President of Fairfield Financial, a primary source for private money since 1964. Fairfield is currently targeting loans in OR, WA, AK, CA, CO, ID, FL, GA, ID, MT, NV, NY, OK and TX. To submit a loan to Fairfield for consideration: http://www.privatemoneysource.com/loanproposal.php
Tags: Commercial loans, hard money borrowing, hard money brokering, hard money loans, private money borrowing, private money brokering, private money loans, real estate
