The following is an example of a common opportunity for a bridge loan to help you achieve your real estate goals. This hypothetical case study is based upon real life value add opportunities where the owners/investors made tremendous profits.
Case Study #2 Multi-family
Borrower saw an excellent opportunity to purchase a small run-down multi-family building with 14 units that had rents well below market value rents. Building was outdated and needed repairs and a facelift. Once updated and remodeled it was projected that the units would bring in a substantial rent increases, so it was a good buy, fix, refinance and rent opportunity or a great flip opportunity.
This was a perfect value add scenario. The only problem was most banks or loan companies would not lend on a 14-unit complex in this condition. That is where private money fits perfectly as WE Direct Lending can make loans based on the collateral and it’s renovated value to help the investor achieve their goals. Simply put at WE Direct Lending we have the ability to see the potential and future value appreciation of the project and lend accordingly.
In this case the purchase price was $900,000 and the borrower was able to put down 30%. But the borrower needed a temporary loan for the initial purchase of $630,000 and for $150,000 of renovation costs. The loan was made at 2 pts. and 8% interest and the initial monthly payments were around $4200 (interest only payments). As construction funds were released the payment rose slightly and a after 5 months of remodeling the borrower began releasing the property at above average market rates and, once fully leased (took 60 days to lease up) they immediately put the property back up for sale. The property was sold for $1,425,000. This is a great example where the borrower’s unique vision of what the property could be, combined with a good deal of sweat equity and creative financing led the investor to make a very nice profit!Contact Us
WE Direct Lending is comprised of reputable business experts with illustrious experience in the financing industry. We promote the principle of financial inclusion, safe lending for the borrowers, and excellent opportunities for investors. We also aim to provide simple and convenient financing for borrowers, realtors, and mortgage brokers.
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