{"id":765,"date":"2013-08-05T12:12:36","date_gmt":"2013-08-05T19:12:36","guid":{"rendered":"http:\/\/privatemoneysource.com\/broker-blog\/?p=765"},"modified":"2013-08-05T12:12:36","modified_gmt":"2013-08-05T19:12:36","slug":"loans-we-are-placing-example-2","status":"publish","type":"post","link":"https:\/\/privatemoneysource.com\/broker-blog\/?p=765","title":{"rendered":"Loans we are placing – example"},"content":{"rendered":"

Clay Sparkman<\/em>
\nEvery now and then I like to present one of the loans that we have placed or are in the process of placing, so that blog readers can see (a) the types of loans that we are placing, and (b) how we believe that loans should be presented. Keep in mind that this is only the initial summary, and that it must be followed up by the relevant supporting documents.<\/em><\/p>\n

Kristopher Gillmore<\/p>\n

Fairfield Financial Services, Inc<\/strong><\/p>\n

16055 SW Walker Road, #247, Beaverton OR 97006<\/p>\n

Phone (503) 319-7294 \/ Fax (503) 419-4219 \/ E-mail: gillmore@privatemoneysource.com<\/a><\/p>\n

REAL ESTATE PROSPECTUS<\/span><\/strong><\/p>\n

SECURED LOAN<\/span><\/strong>
\nPurchase and renovation of a Single Family Residence in Austin TX.
\nLoan Details<\/span><\/strong><\/p>\n

    \n
  1. Loan Amount: $85,000<\/li>\n
  2. Term: 12 Months<\/li>\n
  3. Interest Rate: 12%<\/li>\n
  4. Monthly Payments: $850.00 \u00a0Interest Only<\/li>\n
  5. Security:\u00a0 Deed of Trust in 1st Position security interest in real property located at yyy, Austin TX 78753<\/li>\n
  6. Construction Holdback Account: 20,000<\/li>\n
  7. Projected Value by Appraisal:\u00a0 $126,000<\/li>\n
  8. Projected LTV based on Appraisal:\u00a0 67%<\/li>\n<\/ol>\n

    <\/span><\/strong>
    \nLoan Overview<\/span><\/strong>
    \nXxx is a real estate investor and is requesting funds for the purchase and rehab of this Single Family Residence in Austin, TX.\u00a0 This is his first fix and flip project, but he does have experience in rehabbing residential property.\u00a0 Xxx purchased a 4-plex in disrepair, renovated the property, and is currently living there while renting out the other units, allowing him to live there for free with a small positive cash flow.
    \nXxx will be making a $13,000 down payment, and will exit the loan with the sale of the house.\u00a0 Note \u2013 given the borrower\u2019s debt to income ratio and credit score, it seems like a conventional refi would be an option as well, should he have difficulty in selling the house.
    \nProperty <\/span><\/strong>
    \nThe subject property is a 1,000 home built in 1964.\u00a0 The lot it 8,411sf, and the house has 3 bedrooms with 1.1 baths.\u00a0 The property is in disrepair, although reported to be structurally sound (a certified home inspection report is pending).
    \nThe borrower will be hiring a licensed contractor to paint the entire house inside and out, redo the flooring, replace the fixtures, roof work, countertops, etc\u2026\u00a0 The borrower will be doing the landscaping work himself.\u00a0 It should be noted that the budget as included in the appraisal is more extensive than the work that will actually happen.\u00a0 That budget includes the removal of walls and reconfiguration the pantry area.\u00a0 The borrower belies that staying with cosmetic updates will yield the same value and be more appropriate given the style and age of the property.
    \nA revised budget has been provided in the full packet.\u00a0 Note \u2013 although the bid for the repairs is $14,683, the total holdback will be $20,000 to allow for a contingency and funds for landscaping.
    \nValuation<\/span><\/strong>
    \nTwo appraisals have been provided by the borrower.\u00a0 The 1st<\/sup> is a more formal appraisal, with an actual site visit.\u00a0 The 2nd<\/sup> is a desktop appraisal with computer generated comps and no site visit.\u00a0 For the purposes of this report, the appraisal with the site visit and lower estimated value has been used for all LTV calculations.
    \nThe comps provided in this appraisal seem fairly homogenous, and appear reasonably comparable as far as size, style, condition, location, etc\u2026
    \nThe appraiser suggests a projected value of $126,000 after the proposed repairs. \u2013 Note \u2013 the list of repairs supplied to the appraiser is more extensive that what is actually being done.\u00a0 The borrower believes that the repairs as provided to the appraiser would not provide the additional value to warrant such repairs, and that more modest updates would yield a similar value and stay more in line with the age and style of the house.
    \nIncome<\/span><\/strong>
    \nA signed 1003 has been provided in which the borrower states a monthly income of $4,438.\u00a0 His only real asset is a 4-plex in which he resides, while renting out the remaining units, resulting in a net cash flow of $105\/month.\u00a0 With his outstanding debt (mainly a student loan), he\u2019s showing a negative net worth.\u00a0 That being said \u2013 he does have a fair amount of equity in the 4-plex (Approx. 60K).
    \nChris reports his total monthly obligations as $1,125, which would increase to 1,975 with this loan.\u00a0 Based on these numbers, his ability to service the debt from this loan seems reasonable.\u00a0 If the sale of the property turns out to not be a feasible option, his debt to income ratio would open up the possibility of a conventional refi.
    \nCredit<\/span><\/strong>
    \nA recent credit report shows a mid-score of 686.\u00a0 There are no 30 day late payments reported and all of his accounts are current.
    \n—end of prospspectus—
    \nIf you have questions about this prospectus, or if you have similar loan files that you would like to pursue, please contact us via e-mail, phone, or comment.
    \n\u2013 Clay (clay@privatemoneysource.com, 503-476-2909)
    \nClay 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 Every now and then I like to present one of the loans that we have placed or are in the process of placing, so that blog readers can see (a) the types of loans that we are placing, and (b) how we believe that loans should be presented. Keep in mind that this […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_s2mail":""},"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/privatemoneysource.com\/broker-blog\/index.php?rest_route=\/wp\/v2\/posts\/765"}],"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=765"}],"version-history":[{"count":0,"href":"https:\/\/privatemoneysource.com\/broker-blog\/index.php?rest_route=\/wp\/v2\/posts\/765\/revisions"}],"wp:attachment":[{"href":"https:\/\/privatemoneysource.com\/broker-blog\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=765"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/privatemoneysource.com\/broker-blog\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=765"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/privatemoneysource.com\/broker-blog\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=765"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}