PR Log - Aug 25, 2011 - With the conventional real estate lending industry almost non-existent, so many are turning to private lenders like Mager Capital for alternative capital structures.
After the collapse of the financial market in 2008, we noticed an influx of private real estate investors flooding the market, trying to get in on the 12% returns, however "Hard Money is shifting in 2011.
Mager Capital just introduced their new "Soft Money" product, which appears to be a very attractive alternative to a bank loan. Most private lenders write their loans for a short 1 or 2 year term, but Mager Capital offers a 10 year term! Yes, I said 10 years. Where many private real estate firms are dependent on providing short term returns to their investors, Mager Capital has successfully secured over $300 million as long term investments in 5 and 10 year increments. Being that these loans offered are for 5 and 10 years, the underwriting guidelines are a little more stringent than your run of the mill hard money lender, but understandably so.
The loan terms are so impressive for a nationwide, private money product that I have to share the wealth of information in this publication.
Loan Amounts: $1M to $10M
Loan to Value: Up to 65%
Lender Points: 2.5% MAX
Loan Terms: 5 to 10 years
Property Types: Commercial only and ALL types considered
FICO Req: 680 + across the board
States: All major metro areas in every state
PP Penalty: 6 months to 1 year
Net Worth: Like to see 1.5X the loan amount with 10% liquid
Amortization: 30 Years Interest Only
Appraisal: Appraisals are required in most cases
Upfront $: A deposit for the appraisal &/or phase-1 is required
As you can see Mager Capital is fair in their underwriting requirements for a long term product that is quickly becoming very popular. They have an impressive alternative to institutional loans and what is more important, they can actually fund a loan in 3 weeks instead of the 3 month bank norm.