Commercial Property Liquidity Values


I’m doing some research on hard money lending, and im having a hard time finding the process or any sort of guidelines that the lenders use the determine the liquid value of the property if the borrower defaults on the loan. I wouldn’t think that a standard appraisal would be a common process in hard money lending due to the time constraints, but besides photos, previous appraisals or value estimates, and comps, i can’t figure out how lenders determine the risk and liquidity value of the property.

Any help on this subject would be greatly appreciated.

-Ryan Rusden

your key question is how many times does the rent cover the mortgage payment… min RQ is 1.20 they also look at the business the employment in the area (usually rural has lower chance b/c of convertion if they company fails who will buy it)

ask for the current owners Operating Statement on the property. to see expenses (Schudule “E”)

Also, concerning Enviromentals, what type of analysis is done in this area? During a brief 6-month employment at a commercial brokerage firm, we waited sometimes for months for enviromentals to be done, and in many cases lost loans because of enviromentally-ill property.
What type of concern is put toward enviromentals in hard money lending, and is their a quicker and less extensive analysis that can be done check these things out?