Frequently Asked Questions
1. How does the program work?
We loan Real Estate Investors money to purchase and rehab real estate. We can fund quickly, typically within 48 hours of receiving the final docs from the title company. Hard Money is available for adequately collateralized loans on single-family residential houses and other Real Property including commercial projects. There are just 4 simple steps to our loan: get a contract, fill out the applications, provide the required documents, and close the loan.
The application covers the below 3 topics.
* Credit authorization
* Borrower information
* Property Evaluation
The Credit Authorization information is used to pull credit. We evaluate a deal on the merits of the property and the individual investor. The Borrower Application information is used to gather the information needed for the Promissory Note and Deed of Trust. The Property Evaluation Information identifies the important points on your deal, how much you are paying, how much is needed in repairs, how much the house will sell for, and a list of some of the other costs. This will give you a good idea of how much profit is in the property for you. After submitting these forms, you can expect a preliminary answer within 1-2 business days and funding within 7-10 days, if everything is ready and the title company has their work done.
2. What is the interest rate?
Depending on the length of the note, the rate is between 11% - 14% interest only. Annual interest rate payable monthly.
3. What Loan-to-Value are you looking for?
Typically a loan does not exceed 70% of the after-repaired-value (ARV).
4. How long is the loan for?
We write the notes for 1 to 12 months. There is no pre-payment penalty.
5. What are the costs?
All loans will require at-least a Title Policy, Insurance, Inspection, "As Repaired" Appraisal & Flood Certificate.
6. Can I get repair money?
Yes. We require a Scope of Work And General Contractor's Bid to be included with the application to identify the order in which you will repair the property, Copies of the bids from the vendors. Then, we will pay you as the work is completed and inspected we do not pay in advance for any work.
CML Lending will provide funding, for qualified investors, up to 70% ARV (After Rehab Value). On a house with an ARV of $150,000 that means an investor could qualify to borrow up to $97,500. 100% of the rehab amount will be escrowed for construction draws and the balance will be available to be used towards the purchase price.
7. Does my credit matter?
Yes and no. For the most part, we look at the value of the property after it is repaired, how much you are paying for it, and how much the repairs will cost to determine how much we will lend. With your consent we will need to check your credit history. We are not looking for a specific credit score however we want to be sure this is a good loan for all parties.
8. How do you decide how much to loan?
Typical loan range from $75,000 to $2,000,000: All loans are considered on a case-by-case basis. Minimum ARV (after repair value) is $75,000
9. Where do you loan?
We loan in major metropolitan areas of Colorado, Kansas, Missouri, and Texas. (Greater Metro Denver, Kansas City, & Dallas).
10. What states do you loan in?
Colorado, Kansas, Missouri, & Texas
11. Do I need an appraisal?
Yes, we require "After Repaired" appraisal from one of our "approved" appraisers. Don't ever be persuaded not to get a valuation completed.
12. Do you require inspections?
Yes, we require inspections including the interior before funding and before a repair draw to ensure the work is completed in a satisfactory manner. We also recommend investors to have the sewer scoped.
13. Do I need to put any money down?
We want to ensure that you have enough resources to finish the repairs and cover the costs of the loan plus any surprises. All requirements for down payments will be discussed at the time of taking the loan application. If your loan amount covers the purchase price and repairs 100%, chances are you found a great deal.
14. How long does it take to fund?
We can fund as-soon-as we have the appraisal, proof of insurance, a title policy, and a letter from the title company that they will follow our closing instructions.
After submitting the CML Lending Loan Application, you can expect a preliminary answer within 1-2 business days and funding within 48 hours of receiving the information we need from the title company. A typical loan takes 1-2 weeks from application to closing.
15. How many loans can I have opened at any one time?
Provided you are current on all of your loans, no limits are set. Please call to discuss your lending options.
16. How much will my payments be?
To figure your monthly payment simply multiply the interest rate by the loan amount and divide that number by 12.
17. Will you finance commercial properties?
Yes, on a case-by case basis and then only if the loan is secured by improved real property such as the building and land.
18. Will you finance apartment buildings?
Yes, we finance apartment buildings however understand that it will take us longer to get our due diligence done.
19. Do you allow interest to be deferred to the end of the loan?
No. Our programs have interest payable monthly.
20. Do you require a survey?
Yes, depending on state and title requirements. We will accept an existing survey if there have not been any structural changes.
21. What paperwork do I need to do?
Once you fill-out the Online Application, we will need a copy of the Contract and the Scope of Work. We will also need the required documents listed on initial letter you receive after you have submitted your application in-order to close and fund the loan.
22. Do you do re-finances?
Depends. Call to discuss your needs.
23. Do you loan on rural property?
No. Exceptions sometimes made on a case-by-case basis.
24. Do you loan on rental property?
We can loan on rental property, but you will need to have the property refinanced when the term ends.
25. Do you lend on properties in the flood zone?
Yes. However the Max LTARV is 65%, and flood insurance is required.