Hard Money Loan for Townhouse Rehab in Washington DC

Equity Lending, Inc., a direct lender for the DMV region, provided a $345,000 1st lien position hard money loan for the acquisition of a single-family home in the Kingman Park neighborhood of Washington DC. We funded 100% of the $305,000 purchase price. The subject property is a well-located two-bedroom and two-bathroom residential townhouse. It had been partially renovated pursuant to an agreement with the owner to take possession before closing and begin the renovations. At the time of closing, the project was about 75% complete with remaining construction costs of about $125,000. Essentially, the loan-to-value was about 80%, but much of the construction risk was eliminated due to the hardest aspects of construction already being completed. The Borrower had a clear plan in place, including a general contractor and approved permits. He was able to complete the renovation within budget and sell the townhouse for a nice profit. The interest rate was 11% and we charged 3% origination points. The loan term was set at 12 months. This hard money loan was funded in October 2016.