{"id":118,"date":"2010-08-02T11:50:58","date_gmt":"2010-08-02T18:50:58","guid":{"rendered":"http:\/\/privatemoneysource.com\/broker-blog\/?p=118"},"modified":"2010-08-02T11:50:58","modified_gmt":"2010-08-02T18:50:58","slug":"ignoring-the-experts","status":"publish","type":"post","link":"https:\/\/privatemoneysource.com\/broker-blog\/?p=118","title":{"rendered":"Ignoring the experts"},"content":{"rendered":"

Clay Sparkman<\/em>
\nOne thing I can tell you about private money is that the regular rules don\u2019t work there.\u00a0 And in fact, there aren\u2019t really any rules that you can count on.\u00a0 At best, there are guidelines and these vary greatly depending on the broad spectrum of particulars that define a particularly loan request.
\nWith private money, it is the entire story that matters.\u00a0 In general, it is not possible to say that one thing isn\u2019t relevant or another is always a critical factor.\u00a0 When making a decision about a private money loan request, it is necessary to assimilate all of the relevant information, and what\u2019s more, this information must be assimilated by a curious, creative, thinking individual–not a robot or a decision machine.\u00a0 There is no equivalent of the lender matrix in the world of private money.
\nThe analytical process is powerful\u2014particularly in contrast with the black and white criteria based \u201cthinking\u201d of the banking world.\u00a0 In order to demonstrate, I\u2019m going to tell you about two occasions during the past three months when we did what no bank would ever do.\u00a0 We listened to the experts, and then proceeded to ignore their advice.
\nOn the first occasion, we were approached by a land developer in Oregon with a somewhat unusual loan request.\u00a0 This man is an ongoing client of ours, and we respect him immensely for his knowledge and his ability to get things done.\u00a0 Let\u2019s call him Mr. C.\u00a0 Mr. C wanted to borrow on a subdivision in process on the southern coast, and his request had an unusual aspect.\u00a0 It based the lot configuration of the site, and thus the appropriate current valuation, on a very obscure reading of the legal code.\u00a0 Mr. C showed me the code and explained to me what it meant, and I said that I tended to agree with his reading, but didn\u2019t trust myself to interpret code in such a critical matter.\u00a0 I suggested that we run it by my attorney and get a conclusion in writing.\u00a0 My attorney came back with a view that appeared to be contrary to the conclusion of Mr. c, and so I took the conclusion back to Mr. C and he looked it over and said, \u201cthis is a county matter not a statewide matter; if I get a planner at the county to affirm my position in writing, will you go along with me?\u201d\u00a0 I said that I would so long as the position was clear.\u00a0 About a week later, Mr. C forwarded an e-mail to me from one of the top land planners at the county and this e-mail quite clearly stated a position in line with that put forth by Mr. C.\u00a0 We went ahead and made the loan.
\nOn a more recent occasion, we were approached by a broker representing a builder in Montana.\u00a0 The builder sought funding to build a large single family spec home.\u00a0 The builder looked good to us and the proposal made sense.\u00a0 An appraisal was already in process, so we said that we would go forward with the loan subject to the appraisal supporting the borrower\u2019s opinion of value.\u00a0 When the appraisal was finished, everyone was a bit surprised: the appraisal came in significantly under value.\u00a0 We asked the borrower for their opinion on this and they said that it was very clear to them that the appraiser had failed to adequately value the daylight basement of the subject property and that this was the reason for the reduction in value.\u00a0 So we here at Fairfield read carefully through the appraisal and did some checking with realtors in the subject property area, and it was quite easy to conclude that our borrower was correct.\u00a0 We re-analyzed the value, based on a sensible square foot figure for daylight basement footage, and came up with a value of our own (a bit less than what the borrower expected, but a good $30,000 more than the face value of the appraisal).\u00a0 Again, we went ahead and made the loan.
\nThe point I\u2019m trying to make is that you need to think about private money in a different way.\u00a0 The making of a private money loan is a search for the truth.\u00a0 You won\u2019t always get the answer you want from us, but I can assure you that listening, logic, and a broad understanding of the facts will ultimately determine our conclusion.<\/p>\n

— Clay (clay@privatemoneysource.com, 503-476-2909)<\/p>\n

Clay is Vice President of Fairfield Financial, a primary source for private money since 1964.\u00a0 Fairfield is currently targeting loans in OR, WA, AK, CA, CO, ID, FL, GA, ID, MT, NV, NY, OK and TX.\u00a0 To submit a loan to Fairfield for consideration: <\/em>http:\/\/www.privatemoneysource.com\/loanproposal.php<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Clay Sparkman One thing I can tell you about private money is that the regular rules don\u2019t work there.\u00a0 And in fact, there aren\u2019t really any rules that you can count on.\u00a0 At best, there are guidelines and these vary greatly depending on the broad spectrum of particulars that define a particularly loan request. With […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_s2mail":""},"categories":[9,14],"tags":[38,42,43,45,46,49,53,54,55,57,58,60,61],"_links":{"self":[{"href":"https:\/\/privatemoneysource.com\/broker-blog\/index.php?rest_route=\/wp\/v2\/posts\/118"}],"collection":[{"href":"https:\/\/privatemoneysource.com\/broker-blog\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/privatemoneysource.com\/broker-blog\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/privatemoneysource.com\/broker-blog\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/privatemoneysource.com\/broker-blog\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=118"}],"version-history":[{"count":0,"href":"https:\/\/privatemoneysource.com\/broker-blog\/index.php?rest_route=\/wp\/v2\/posts\/118\/revisions"}],"wp:attachment":[{"href":"https:\/\/privatemoneysource.com\/broker-blog\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=118"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/privatemoneysource.com\/broker-blog\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=118"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/privatemoneysource.com\/broker-blog\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=118"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}