Hard Money Cash Out Loan for Jersey Shore Rental Townhouse

Gelt Financial, a direct hard money lender, funded a $225,000 equity cash-out refinance loan secured by a residential rental property in Wildwood, NJ. The Borrower had a unique financial situation. She and her husband owned a total of 4 properties, but they went through a divorce, and the judge allocated 2 properties to each spouse. The husband was ordered to remove the Borrower from his 2 properties within a certain time frame but failed to do so, and both went into default. This ruined the Borrower’s credit, so she was unable to get a conventional loan. Eventually, the judge ordered those 2 properties to be allocated to our Borrower, but they came with a lot of past-due taxes and penalties. The subject property for our hard money loan was one she owned free and clear. It’s a townhouse/condo very close to the Shore and is always rented out seasonally with short-term leases, so there wasn’t enough verifiable income on it for her to get a conventional loan. We estimated the value to be over $550,000 which put our 1st mortgage at around 50% loan-to-value. We did not require an appraisal. The Borrower plans to sell one of her other properties in order to pay us off within the 2-year loan term. This hard money loan was funded in June 2021.