This was sent to me. Is it a good deal? I’m questioning the 2 points and prepay penalty.

This We loan up to 80% of the “after repaired value” (100% of the purchase price and 100% of the repairs cost needed)

The rate is 6.75%* (Rate will always be 2% above prime)

Origination is 2 points

Pre payment penalty is 1%

No limit on purchases

Anywhere in Texas

You may use your own appraiser.

Fast closings

It’s not bad at all for a hard money lender – their rates are usually 12-15% and 3-5 points and most will only lend up to 65-70% of ARV.

Since their rates are much lower than your average HML, I have to wonder … How quickly can they close? Can they lend on a property that needs extensive rehab (i.e., foundation, mold, etc)? What are the other fees?

I got this message emailed too! I think we have been infiltrated and people are spamming this site. First and foremost do your home work! And if some people are still resorting to spam as a means of advertising I wonder what other shady practices are up there sleeves.
A good rehab loan will allow for 6.75% on a 30 year fixed (make sure of what’s behind that rate) I wouldn’t recommend paying any points. And 90 Percent of the total ARV is a better deal, and does anyone know if there are any good deals in Texas? More and more I am staying away from there because every deal has come in undervalue. (Existing liens are higher than the comparables in the area)

Thanks for your reply. I’ve read a lot of your responses and it’s obvious you have knowledge in your insustry.

Could you please elaborate for me and the other Texans that visit this forum what you mean when you say undervalue. Is this an overestimation of the ARV? Have you had to foreclose on Texan clients? And please explain the lien issue you alluded to. Thanks in advance.

In my limited experienc I’ve never run across a HML lender with such good terms.

HML’s, as mentioned previously, charge a lot more for their more easily obtained money.

Do your due diligence.

I think “Mortgages” is right…the site has been infiltrated – I got this too.

If you received an unsolicited email, please forward to me so I can address the issue. Thanks.