Commercial Hard Money Lender

I am just starting to take a look at investing in commercial real estate. I am trying to compare it with residential in terms of financing and other things that I have to do. In residential property I got prequalified with a hard money lender before I looked at properties. Should I get prequalified with a hard money lender before looking at commercial RE? In commercial they are basing the cashflow numbers off of the building instead of your own personal credit right? Thanks, Mike

If there is good cashflow why not try a Bank first rather then a HML? As long as you have all the necessary documents and statements to prove to the Bank that the complex basically generates all the income and you have a good property management team and can find a way to get atleast 10%, I would suggest the Banks money and their cheaper rates.

There are so many financing options out there now. Stated, low doc, high LTV, etc.

Definitely try conventional financing first.

Good Luck!

No need to go with a hard money lender unless you have challenged credit or your looking to flip a property.

Mitch Chapman

You don’t need to get prequalified with anyone for commercial.
It’s not like residential.

The reason residential lenders have to be so cautious and only accept certain brokers is because of the regulation in the residential lending arena. RESPA and various other laws are there to protect uninformed residential borrowers to lessen the potential for them getting ripped off.
Commercial borrowers, conversley, are expected to be more savvy, ergo, there are far less restrictions or rules.

Good luck.



I’ve learned that buying a commerical property is much different than buying a residential property (4 units or less). I understand that one can buy a residential property with little or no money out of pocket while buying a commerical residential property (5 units or more) requires that the buyer bring a significant amount of cash to the table.

Is it possible to get maybe an LTV of 60% by a hard money lender then get the other 40% from a second hard money lender, and make the purchase with little or no money out of pocket?

I would very much like to buy a commerical residential property (i.e. hotel, motel, large apartment complex) but my problem is I have no cash to bring to the table.

I own my own home with little equity (100% financing), earn about 50K net per year, and my credit scores are 657 687 691). I had a bankruptcy discharged about 3 and 1/2 years back.

Can it be done?

Apt Building Guy :-[

The answer to your questions is yes and most likely.
Unless you have really really bad credit, I don’t see why you are even thinking of going the hard money route. Hard money is usualy only used for two reasons.
1- Really bad credit
2- Need an immediate closing and your willing to pay exhorbitant fees to get it done so you don’t lose a deal or deposit.
I lied. There’s a 3rd reason.
3- The deal is very unusual and there is no standard established for the amount of risk based on the property.

Your mid score is fine. If you have 3 years in some business you could qualify for an unsecured Line of Credit.

By the way, you can do a straight 100% apartment bldg loan without being creative.


Hi Keith,

Actually, I figured out what you were talking about with the sgnature lines etc. and now I got it right.

Thank goodness I know more about lending than about forum ettiquette, but we can all learn. Even old dogs like me :slight_smile:

Ya gotta have a little patience.

Good job Jeff…I had noticed that you had gotten your sign-off done…I thought you were turning into a “problem child”!

LOL…Merry Christmas!


I may be dumb, but I’m not stupid :slight_smile:
Sorry for the misunderstanding.
I got it now.

Merry Christmas et al.


I’m glad you guys worked it out!! No hard feelings I hope!!

I’ll be contacting you to talk with you in depth. I think it best for me to talk after the holidays. Have a great holiday season guys!!

Apt Building Guy :stuck_out_tongue:

Have a great holiday.
Catch ya then.