Private equity firms are stepping up to lend home builders the money they can't get from banks. Rates are usually somewhere between 15 percent and 20 percent.
Don Faye, a part owner of Presidio Residential Capital, says the best customers are small builders seeking loans of a few million dollars.
While such loans are expensive, they often come with few requests for documentation of construction costs, says John Burns, CEO of John Burns Real Estate Consulting.
Source: The Wall Street Journal, James R. Hagerty (02/03/2010)
Did you ever think you would see 20% loans again?
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