Private Money 2nd Mortgage for Echo Park Multifamily Rehab Completion in Los Angeles, California

SDC Capital, a direct private lender based in Burbank, funded a $600,000 1st and 2nd lien position private money loan for a rehab completion project in the Echo Park neighborhood of Los Angeles, CA. The Borrower, a repeat client of ours, was stuck in the middle of rehab on a 100-year-old house and bungalow. The two structures were part of a 7-unit multifamily property. The other 5 units were leased and cash-flowing. The Borrower wanted to keep his bank rate 1st lien in place so the request was for additional funds in a 2nd lien position that he could use to finish the project. The LTV request was 75%, which was higher than we were comfortable with given the extent of the rehab. Fortunately, we were already familiar with another property owned by the Borrower and were able to cross-collateralize the loan with that property to get down to an acceptable LTV of 65%. Due to our relationship with the Borrower, we were able to get creative and close a complicated deal with many obstacles. The interest rate was 9.99% and we charged 1.50 points (origination fee) for a 12-month term. This private money loan was funded in July 2020.