Hard Money Loan for Vacation Rental Fix & Hold in Ocean Beach, California

In December 2020, TaliMar Financial funded a $1,143,100 fix and hold hard money renovation loan secured on a single-family home in Ocean Beach, CA. Our client will complete a cosmetic renovation and hold the property as a vacation rental. Our hard money fix and hold loan included funds for both the purchase and 100% of the renovation costs. The loan was underwritten to the completion value. The renovation funds will be disbursed to the Borrower over seven draws based on pre-approved construction hurdles. The biggest hurdle in this transaction was the current condition of the property and the existing tenant. We were able to underwrite to the condition knowing the Borrower was intending to renovate the property and their prior experience completing similar projects. Additionally, they had the tenant agree in writing prior to closing to vacate the property within 30 days of close. Once the renovations are complete and the Borrower establishes 6 to 12 months of historical income, they will be able to refinance the hard money vacation rental loan with conventional bank financing. Hard money vacation rental loans have become very popular in urban markets in California. Many real estate investors use hard money lenders to fund fix and hold loans because most conventional lenders will not.