Fairfield Financial Services, Inc. - Private Money Loans, Lending & Borrowing

S. Clay Sparkman and Richard Sundvall
There are certain key pieces of information that we need to know when we’re sizing up a deal.  Having this information when you contact us can speed up the process considerably.  Also, if you have these pieces in hand you can talk about your deal more clearly and present yourself as someone who is professional.  Because of the way we work at Fairfield, all of the pieces here are necessary to complete the picture of a scenario in order to get you and your clients a quote on a loan quickly.
This is important: don’t send us everything you have on a scenario and expect us to find the loan in a sea of documents. Sending too much information can overload us quite quickly.  We would prefer the basics of the scenario before turning on the document hose.  Also, please, never send us your borrower’s personal information unsolicited.
Description of the property
We need to know where it is, what it is, the size and its status.  If it’s land, we’ll need to know the zoning and its access to utilities.  As an equity lender, we’re all about the property.  This will form the basis of our loan.
Description of the Project
You need to be able to tell us what the borrowers plans are for the property.  Be prepared to talk about the strengths as well as the weaknesses.  You can also give us some perspective by talking about the area around the property and how the borrower’s project compares to other projects that are similar nearby.
Loan Amount Requested and Use of Funds
When you do a rough calculation of loan amount, let us know if your amount is the net amount you need after fees or if you are giving us an amount that includes fees. Also, tell us how the funds will be used.
‘As-Is’ Value of the subject property
This is a critical value for us.  Even more so than a future value.  It’s the first step in making sure the loan works. We base our Front End LTV on this number (pay off plus loan fees divided by ‘as-is’ value is the formula).  Our loans are critically dependent on this value.  Also be able to tell us how you derived this number.
Future Value
This is also the finished value or after repair value.  Again, be able to tell us how you derived this number.
Pay Off Amounts or Purchase Price Due
We’ll need to know the balance of any loans that need to be paid off.  If the loan involves a purchase, refer to the Purchase Agreement to give us the price AND the expiration of the agreement (which is important to determine if we have enough time to close or not).
Construction Budget (if applicable)
This is a line item listing of all the expenses required to complete any construction on a project.  This should include soft costs.
Interest Reserve Amount if Requested
Obviously, since you won’t know the actual rate prior to a quote, you can estimate the amount here or just state how many months your borrower is requesting.
Requested Term
Generally our loans are for one year to three years.
Statement of Exit Strategy
Exit is also critical to hard money loans. It is important to us that you have a clear way out of the loan and it’s even more effective if the strategy contains multiple contingencies.  For example, if you state the exit strategy is sales, then also tell us what will the borrower do if there are no sales.
Number of Points for Brokers
Let us know how many points you are adding for yourself and your referring entities (if there are any).
Borrowers stated income per month, stated net worth and mid FICO score
These items are necessary for a quote.
These dozen items may seem like a long list, but each will only take a line or two to answer.  We know it’s difficult to pare down the amount of information an enthusiastic borrower can bestow upon you.  Borrowers usually know volumes about their deals.  Breaking it down to these essential items will give us the picture simply and clearly.  It will also allow us to tell you quickly whether on not it’s a loan we can do and at what price.

— 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, construction loans, hard money borrowing, hard money brokering, hard money loans, Multifamily, private money borrowing, private money brokering, private money loans, Quick flip loans, real estate, real estate rental, rehab loans, subordinate loans

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