California Hard Money Seconds for Business Purposes

For many people who own property with existing loans at excellent terms it can be difficult to tap the remaining equity.  Loan guidelines have changed, as have rates and the ability to obtain cash out on a new first loan at similar or more advantageous terms.  Additionally, many institutions are limiting their second position lending programs, making it difficult at best to obtain a second or line of credit for the equity in an existing property.  In situations like these we are able to help with California hard money seconds for business purposes.

Our ability to assist in obtaining lines of credit or second position loans on property comes down to a few basic factors.  The first factor is CLTV, or cumulative loan to value.  This is the ratio of existing debt plus the proposed debt to the value of the property.  On our hard money seconds we are typically able to help up to a maximum CLTV of 65%.  For example, on a property worth $1,000,000 that has an existing loan of $400,000, we could potentially help with a hard money second of up to $250,000 ($1,000,000 value x 65% = $650,000 maximum total debt.  $650,000 maximum total debt - $400,000 existing debt = $250,000 maximum potential loan).

Another factor that we take into consideration is the use of funds.  We are not able to help with consumer purpose hard money second deeds of trust.  We are only able to help with hard money seconds where the use of funds is for business purpose.  For example, a business looking to expand, acquire new offices, increase inventory, start a new advertising campaign, etc.  For real estate investors it could also mean obtaining funds for purchasing additional rental properties, putting a down payment on additional investment property or improving existing investment properties.  It could also be used to purchase a legitimate business, as well as a number of other business purpose uses.  

The use of funds dictates the purpose of the loan.  We can even potentially make hard money seconds on owner occupied homes, but the use of funds must be documented and we must be able to confirm the business use of those funds.  We can make these hard money seconds to individuals, LLC's, corporations or other legal entities.  We cannot help with a hard money second for consumer purposes.  For example, we do not make these loans to pay off consumer debt, purchase vehicles for personal use, send children to college, etc.

In addition to the maximum CLTV and the use of funds there are other items we need to confirm, which can vary depending on the transaction, property type and existing loan on the property.  We can help with seconds for most property types - residential, multi-family, commercial, industrial and unique properties - but not usually on raw land.  Typically speaking these are interest only loans, with terms from 1-3 years, sometimes longer.

For more information, please call today at 877 462 3422 or visit us online to learn more about our California hard money loans that we are able to offer.