Q: What are upfront fees?
A: The fee charged by some lenders before they even start working on the loan, or fees charged for their due diligence. Many private lenders and brokers charge hundreds even several thousand of dollars of upfront fees. That fee is not returned even if the lender does not provide you the loan.
Q: Does FAB Associates charge upfront fees?
A: No. FAB charges no upfront fees. You have no fees or money at risk if FAB decides not to give you a loan. We encourage you to avoid working with lenders and brokers who charge upfront fees.
Q: What are private loans / hard money loans?
A: Loans using private capital that are secured by property – as opposed to conventional loans by banks. Referred to as: Private Money loans, Hard money loans, Bridge Loans, Alternative financing, Asset based lending. But remember – not all lenders are the same. Many lack scale or track record, many have outside investors that limit their flexibility, and others. We are a unique lender – the fastest and most flexible, with no third party capital and all processes done in house.
Q: Why do people usually get private loans / hard money loans?
A: There are several reasons. Below, we listed a few:
- people who have found a great opportunity and want to close the transaction in days rather than weeks or months;
- people who need funds immediately for a business purpose and otherwise may lose the deal;
- people who do not want to or cannot wait for long process of conventional loans from the bank and who do not want to go through the grueling loan process of banks;
- people who do not have time nor would like to provide all the documentation that bank may require (in fact, even though some the documents are not pertinent to the loan, banks will sometimes want those anyways);
- people who may not qualify for a conventional loan;
- people who can have loan modified to much lower amount, but the existing lender/bank wants the loan to be paid off first;
- people whose credit scores are not high enough;
- many time hard money is cheaper than other methods of financing;
- properties which are currently not rented ( not producing cash) or are producing less cash but are in the area where appreciation is high
Q: What can private loans / hard money loans be used for?
A: Mostly used to take advantage of a great opportunity; to buy more properties with the same amount of cash on hand; to turn equity into cash; to take care of immediate financial need.
Q: How much money can I qualify for?
A: It depends on the equity ( or the down payment) you have in the property. FAB typically provides loans from $50,000.00 to $3,00,000, and in a few cases, even higher, up to $4,000,000. Give us a call; we can tell you in a short time an estimate as to how large a loan amount we can provide.
Q: Who qualifies for a private loan / hard money loan?
A: If you are putting sufficient down payment or collateral when buying, or if you have equity in the property when refinancing, you may qualify.
Q: What if I have poor credit? What is the minimum credit score I should have?
A: With FAB, your credit score is not typically a factor in making a loan decision for you. We are very flexible on the credit score.
Q: What type of property FAB lends on?
A: FAB lends on any type of property: Land; Non-Owner Occupied Single Family Residence, Town-Homes, Condos, Duplex, tri-plex, four-plex, Mutli Family units (Apartment building with 5 units are more), Office Building, Retail, Commercial, Industrial, Gas Station, etc.
Q: Does FAB do construction loans?
A: Yes. We have done many in our history.
Q: What is the max loan FAB Associates has provided?
A: FAB has provided loans since 1989 between $50,000 and $3,900,000. Our typical loan today is between $300,000 and $3,000,000.
Q: What is the maximum Loan to Value (LTV) ratio?
A: We do not have a set rule. We are flexible. In general, many of our loans have been with a LTV of 75% or less, but we able to fund loans with a higher LTV – we decide and analyze each case by case.
Q: Can I get a business purpose loan without putting any cash down?
A: We have done these loans, yes. We do not have a set rule. We are flexible. We have had past clients give us cross collateral, such as another business purpose rental property they own, as collateral for the loan and use loan proceeds to make a business purpose property purchase. If the collateral is sufficient, then the loan FAB can provide could be equal to the purchase amount, meaning the client would not have to put any money down. This is just one example – please call us for more details. We decide on each loan case by case.
Q: What type of loans do you offer?
A: We offer interest only loans as well as fully amortized loans with 10,15, 20, 30 and 40 year term. Our typical loan, however, is a 1 year (or 6 month) bridge loan with no pre-payment penalties.
Q: What is your interest rate?
A: Since each loan is unique, we decide interest rate on a case by case basis. But, our current clients will confirm that our rate are very competitive and we have done many loans where a client has a higher rate and comes to us to pay off that loan and get a lower rate loan from us. In addition, our service is the best; no one comes close to our dedication and commitment to you.
Q: Does FAB do second deed loans?
A: We typically only do a first deed. But if you already have a first, we can pay that off and write a new larger first.
Q: What area do you lend in?
A: Most of California. Please see “Our Loan Types & Products”
Q: How soon you can close?
A: In a matter of days. We have closed notable sized loans in as little as 72 hours.
Q: Do you require an appraisal?
A: Because we fund loans with our own capital, we therefore are not bound by the same requirements as a traditional lender. All underwriting decisions are made in house by a seasoned real estate professional that understand the uniqueness of each market and each deal. In many cases, we do an in-house appraisal and many times we do not even charge the borrower a fee for this.
Q: Do you have pre-payment penalty?
A: In general, no, we do not have pre-payment penalties. There have been some loans we have underwritten where the borrower agrees to pay between 3 to 6 months interest. But, we are flexible and this is evaluated on a a case by case basis.
Q: What do I need to start the loan process?
A: Please call us or email us your request. You can also contact us here.