PRIVATE MONEY INVESTMENTS
At Hawkeye Private Capital, we are committed to providing unparalleled service and customized solutions that align with your investment strategies. Our team of experts is dedicated to understanding your needs and delivering personalized financial solutions that drive success.
FIX AND FLIP LENDING
Rates Starting at 10.75%
Interest Charged As Drawn
Single Family and 2-4 Unit Multifamily
No Tax Returns Required
Minimum FICO of 650
Up to 70% ARLTV
No Prior Experience Required
12 Month Term w/ No Prepayment Penalty
A fix and flip loan is a short term mortgage for you to purchase and renovate your property. The fix and flip loan provides the capital to acquire the property and also complete the repairs to help improve the property value. If the project was bought well and the numbers from the rehab budget and ARV were accurate once you are ready to put it back on the market and sell it at a higher price there should be enough money to pay off your mortgage, all of your costs incurred during the project, and should leave for a nice profit left after all expenses have been repaid.
Once the property has been renovated and work is complete if you determine that the best course of action is to hold onto the property and not sell it keeping it as a long term cashflow and appreciation strategy you can refinance out of the fix and flip loan and get a long-term loan through traditional or private lenders.
As work is completed in your fix and flip and you are ready to draw from your construction line of credit you simply complete our draw request that outlines the items of the initial budget that was approved prior to closing that you are looking to get reimbursed for. Once the request has been submitted and processed a draw inspection would be ordered and scheduled between the inspector and investor to verify the work that was submitted for reimbursement was completed. Once the inspection report is received, reviewed, and approved you would be notified and the money would be wired via ACH to your bank account that provided and on file. For a fix and flip loan the investor can use as many or as little draws as needed during the project and based on the cashflow of the investor.
There are many different strategies that can be executed with the fix and flip program. With each investment property and scenario being unique the strategy deployed will be dependent on the overall exit strategy of the investor on that given deal and sometimes multiple exit strategies can apply. Some investors will do very minimal work and put the property back on the market with little to no risk from construction and look to make a quick profit from the trade. Other properties may benefit from force appreciation and adding square footage whether vertical or horizontal can quickly increase the value of the home. Each project will depend on the investor’s preference and also evaluating the condition of the property along with an understanding on that local market.
A new investor can obtain financing with our fix and flip program. With the lack of experience as a beginning investor the loan-to-cost would be lower until more round-trip deals have been completed. It is always encouraged that a new investor has a good team surrounding them. Alpha Funding is very welcoming to new investors when getting into fix and flips and real estate investing. One of the more rewarding parts of lending is being a part of the journey watching new investors complete their first few deals and grow into repeat borrowers growing and scaling their businesses.
NEW CONSTRUCTION HARD MONEY LOANS
Rates Starting at 11.75%
Strong Credit, Liquidity, and Experience
Single Family and 2-4 Unit Multifamily
Stick or Modular Build
Up to 90% LTC and 70% ARLTV
12-18 Month Term Available
Interest Charged As Drawn
Land Development or Knockdown Deconstruction
This loan provides investors with the resources necessary to acquire an existing property and funds to build an entirely new structure. This product can be utilized in a wide range of areas from deep urban to suburban, and provide a new way to approach your next successful investment. To obtain this loan investors typically require previous new construction experience, or a recent history of completed fix and flips. Property types range from single to four family on the residential side, commercial mixed-use, and commercial multifamily. The loan term is generally (12) months with the opportunity to extend further.
Like fix and flips, new construction offers the investor an excellent way to realize a great profit. Once work is completed, investors have the opportunity to either sell the property or refinance the property using the BRRRR Method. Depending on the timeline to build, the property’s ability to generate monthly cash flow, and the growth in the area of investment, selling and refinancing are both viable options. While it is best to approach a deal knowing your end goal and having a strategy for success in mind, AFC will always provide our best options to assist as your priorities shift.
1. The Unknown Elements:
The first time you enter a home that is primed for a flip, you may walk out with a feeling that this project will be a simple “in and out”. After starting construction and peeling back layer upon layer, you find out that this is starting to seem like a bigger project than originally thought. When building new construction, those worries are thrown out the door as you have complete control over foundation, structure, layout, appliances, and anything else you wish to customize. The unknown is not a factor
2. Maintenance Costs:
For the investor that prefers to hold properties as rentals in their portfolio, maintenance can be a large factor in long term profitability. When holding a new construction property, investors can count on key elements including but not limited to the foundation, roof, flooring, and hot water heater to hold up over the initial span of ownership. This in turn limits monthly and annual expenses, helping you realize a larger ROI (return on investment)
3. Increased Supply:
In times of high real estate demand for investors and end buyers, finding properties are always a challenge. Utilizing this program, investors will be able to broaden their horizons. No longer limiting themselves to typical real estate listings, empty plots of land and homes that require demolition now add to the ever-growing list of opportunities.
RENTAL DSCR LOANS
Rates Starting at 6.875%
Rent-ready and Leased Qualify
Up to 80% LTV
Loan Amount from $75,000-$2,000,000
Minimum FICO of 680
Minimum DSCR of 1.0
30-year Fixed Rate
Single Family, 2-4 Unit Multifamily, and Condo/Townhomes
It is a loan for real estate investors that want to invest in rental properties. The property types include single family homes, 2-4 unit multifamily, townhomes, vacation rentals, and warrantable condos. Our long term rental financing can be structured as 30 year amortizing, ARM, or interest-only options.
Our term rental loan program can be used to refinance out of a hard money loan into a lower rate and longer term after the renovations are complete and it is rented out to tenants. It is a very popular investment strategy called BRRRR (Buy, renovate, rent, refinance, and repeat) where investors will repeat this process as a way to accumulate multiple units quickly with very little money invested long term by pulling the initial money invested and using those dollars to acquire more properties. Some investors who do not plan on renovating the property and would like a loan to just purchase can acquire the property with this light documentation option that is based off of the DSCR (Debt Service Coverage Ratio)
Each and every investment is unique. Real estate investors that are looking to own real estate long term or even short term depending on how the loan is structured with the prepayment penalty can benefit from our rental loan with the very competitive rates and terms. Many investors want to get a loan mostly based off of the ability of the income produced by the tenants renting covering the monthly expenses that include the PITI (Principle, interest, taxes, and insurance) payment. The loan is a “light-doc” loan with no income verification is based off of the rental income covering the expenses. The minimum DSCR is usually at 1.0-1.2 where the rental income will have to cover all of the PITI payment and in most cases have a little extra after expenses have been paid being cash-flow positive.
This investment strategy is very popular among investors. By using a short term hard money loan the investor has the ability to purchase a property very quickly usually within weeks or even days without many of the traditional mortgage requirements. The property is underwritten and evaluated based of the ARV (After repair value). Many times, a property can benefit from upgrades and by making improvements to the property and units the value of the property can appreciate and grow in value very quickly. Based on the hard money loan, the LTV usually is around the “65% rule” which allows for the investor to refinance at an LTV around 75-80% once the property is rented out. That higher LTV can in some cases help the investor refinance the money borrowed in the hard money loan and potentially the down payment, closing costs, and some soft costs incurred during the hard money loan. The power of this strategy is where the property and its expenses are covered by the rental income generated from the units and in a good deal being able to recoup all of the initial investment to use for another property acquisition allows to build a substantial portfolio and wealth quickly is executed well.
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