Fix and Flip Loan for Los Angeles House with ADU Addition

Funded by TaliMar Financial

Los Angeles, CA

$616,000

Single Family Residence

Purchase

04/20/2021
Transaction by
TaliMar Financial
In April 2021, TaliMar Financial funded a $616,000 Fix and Flip loan for a single family home in Los Angeles, CA. The Borrower will complete a cosmetic update of the property before listing it for sale. The biggest hurdle on this transaction was the addition of an Accessory Dwelling Unit (ADU). The addition of an ADU has become a very popular option for real estate investors that are doing fix and flips and fix and holds. An ADU offers future buyers of the property to house extended family or rent for cash flow. Because ADU's are relatively new to the LA market and the lack of home sales that include ADU's, verifying future value can be difficult. However, we worked with the Borrower and their listing agent to obtain a finished value by using a mix of recent sales and potential rents for the unit. Our hard money loan funded a large portion of the purchase, plus 100% of the renovation costs. The renovation funds will be disbursed to the borrower over the course of the rehab in five predetermined draws based upon progress.