Residential and Hard Money FAQs
Answers to frequently asked questions about direct lending.
Why SFR Capital?
1What is a Hard Money Loan / Private Money Loan?
Hard money loans are based on the value of the real estate investment property and the equity of the property. The amount loaned is typically 60-80% of the investment property value. The loan is funded by a private individual or entity that has much more flexible requirements and regulations than traditional banks and mortgage lenders
2Why use SFR Capital for your Hard Money Loans?
Traditional bank and property mortgage loans are made by highly regulated lenders that require sponsor/borrower hard credit scores, bank statements, tax returns, appraisals, outside inspections and other complicated and detailed financial information. Hard Money and Private Money Lenders like SFR Capital do not have these requirements.
3Who do you lend to?
SFR Capital lends to business entities such as companies (inc), LLCs and Trusts. We do not lend to individuals or sole proprietors. The owners of the business entity borrower will be required to sign personal guarantees.
4Do the owners of the borrower entity need good credit?
Good credit is not an SFR Capital loan requirement. SFR Capital underwrites the loan by looking at the value of the property, the equity or cash investment in the property and the history of the sponsor/borrower principals. SFR Capital will pull a soft credit inquiry on the borrower principals that does not cost anything and does not affect the credit scores of the principals.
5How do you determine the amount of the loan?
We look to the value of the property, the equity or cash investment from the borrower/owner and the history of the borrower principals. We typically lend 70% to 80% of the value of the property as determined by SFR Capital. SFR Capital will give you a preliminary loan amount approval email within 24 to 48 hours of submission of the 5 minute online application.
6How long does it take to close and fund a SFR Capital loan?
We can fund your loan as soon as the title and lien search are completed, the proper insurance is in place and a correct settlement statement has been circulated and approved. These items can be take anywhere from 3 days to 2 weeks. Once you are approved by SFR Capital for a loan, we will be happy to speak with a Seller to work with you to obtain a closing extension should we need time to close your property transaction.
7Can I get a proof of funds letter from SFR Capital?
Yes. SFR Capital will provide a proof of funds letter for the amount of the loan after loan approval.