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Hard Money Commercial Loans: Credit quality

Hard Money Commercial Loans:  borrowers with bad credit ok

Financial Compound closed a $600,000 hard money commercial loan for the refinance of a primary residence in Los Angeles.  The borrower is a whistleblower who took aim at unscrupulous practices by his employer, a dominant player, and was fired.  As a result, his credit deteriorated and he did not qualify for a home loan with banks.  He started a law firm to represent whistleblowers within this industry and his income and credit have started to recover.  We expect him to refinance conventionally within 12 months.  Loan terms included an 11.5% interest rate, 5 year interest only term, 3% lender fee, minimal pre-payment penalty, 60% LTV.

Commercial mortgage broker Financial Compound was able to identify a lender willing to process and fund this transaction despite most of the capital markets indicating that this borrower did not qualify for the loan he was seeking.  Financial Compound identified an asset based lender that was comfortable with the low loan-to-value nature of this transaction and was able to get comfortable with the lack of additional borrower creditworthiness.