Property ID #703

Why we like this deal?

Beautiful North Shore Hawaiian Estate on the beach. This property has been grossing about $600,000 annually from it’s event rental business.

The borrower has been growing their destination rental business for about 7 years.

The loan to value (LTV) provides a 50.7% cushion of equity.
Additionally, the rental income is $600,000 annually and is 7.05 times the debt service coverage ratio (DSCR). This opportunity presents an investor with a commercial note at 10% for 2 years, secured by a recorded first mortgage lien or deed of trust on this property.

Why the bank can’t lend

The traditional banks may lend after the borrower completes their accounting and additional tasks required to qualify for a conventional commercial loan. The loan will pay off the existing first lien, and reduce the seller carry back loan significantly.

Risk Analysis

We consider the risk to be low relative to the loan to value (LTV).

Property Summary

Property Type: SFR
Property Value: $2,875,000
Loan Amount: $1,417,800
LTV: 49%
GOI: $600,000
DSCR: 7.053
Loan Term: 2 years
Amortization: interest only
Recourse: no
Cross Collateral: no
Max Rate: 10%

Borrower Summary

Source of Income: weddings
Documentation: Available
Guarantees: no
Payment History: Good

Risk Summary

Overall Risk: low
Market Risk: low
Property Risk: low
Borrower Risk: low