A Good Time for Private Money

A Good Time for Private Money

This past year has been a very good year for private money in general and Fairfield Financial in particular. Thanks to all of you for your ongoing support.

At this point, we have an abundance of funds available for good private money loan scenarios, and we have been able to increase our field with regard to the types and sizes of loans that we are able to fund. For example:

(1) We have expanded our operation to Idaho, so that now we will go to any location in Oregon, Washington, or Idaho (no matter how remote).

(2) We have significantly increased our resources with regard to the size of loans that we can do. Anything up to a million is quite straightforward for us these days, and we have access to money for loans potentially in excess of 5 million.

(3) We have added staff, so that we are able to process loans faster. Our average turn-time is less than two weeks, and we have closed a handful of loans this year in 3 days or less.

(4) We pride ourselves in placing loans on the properties that nobody else seems to want to deal with--that is, so long as a reasonable equity position exists. We frequently fund loans on raw land, building lots, partially completed construction, restaurants, bars, auto shops, foster homes, churches, agricultural properties, derelict homes, industrial properties, mixed-use properties, and floating homes--to name a few.

We are eager to have a look at your loans, and we'll do our best to either put them together quickly or let you know when we can't. Either way, we understand that it's all about timing. For your benefit, I have summarized a few of our loan programs below.

-Commercial Property
We make loans on commercial properties of all types, including office buildings, retail buildings, mixed use, restaurants, taverns, motels, car lots, gas stations, mini-storage, malls, industrial properties, and multi-family residential. 75% is generally our maximum.

We have strong ongoing relationships with many investors who buy fix-up properties and re-sell them. We can generally loan up to 75% of the projected value of a project. Generally we arrange for the financing of the renovation money as well. This is a large niche for us, and one of our preferred loan types.

-REO (and other under-market) Property Acquisition
We have had a number of borrowers come to us in search of financing to purchase REO properties. We can generally loan up to 75% of the current value of a project, and frequently 100% (or more) of the purchase price. We often work with buyers of discounted HUD properties, for example, and know the process for getting these transactions closed.

-Raw Land
We will loan on any raw land (i.e., land without infrastructure/utilities) that qualifies as build able. This includes both commercial and residential zoning, urban and rural, and anything from 2,500 square feet to 5,000 acres. With a strong borrower and a good property we will consider loaning as much as 75% of the value. This is pretty much unprecedented in the industry.

-Lots and Acreage with Utilities
Though the banks seem to be hesitant about loaning on developed land (lots or acreage), we are generally eager to do this type of loan. As much as 20% of all the loans we do fall into this category. Our maximum LTV on developed land is 75%.

-Agricultural Properties
We have arranged loans for a variety of agricultural and ranch properties. We are a bit more conservative regarding LTV for properties of this sort, with our maximum being about 65%.

We tailor our construction loan programs to meet individual contractor needs. Though more expensive than traditional bank financing, we are more flexible regarding many issues, and have had many contractors return to utilize our construction loan services repeatedly. Our maximum LTV for construction is 75% of the value of the completed project.

-Floating Homes
The Vice President of Fairfield Financial (that's me) lived on a floating home on the Multnomah Channel for eight years, and was very much a part of that community. We understand the unique issues related to borrowing either to refinance or purchase a floating home. We have loaned money on floating homes that don't fit the bank's strict criteria, and we have frequently loaned money for the upgrade or expansion of an existing floating home. Our maximum LTV for floating homes is 75%.

-Manufactured Homes - on private land
We are not terribly concerned about the year or model, or whether the home is a singlewide or doublewide. We look at the whole package, home and land, and if the value is there, we can make the loan. Our maximum LTV on manufactured home/land packages is 75%.

-Seconds on Investment and Commercial Properties
These are generally short-term scenarios, ranging from six months to one year. The loan must be for at least $50,000 in Oregon (due to a certain Oregon usury law), and the maximum CLTV is 75%.

-Foreclosure Bailout
If there is a good explanation as to why the foreclosure situation occurred and what has changed to remedy the problem (and if the LTV does not exceed 70%) we are frequently able to refinance properties out of foreclosure.

-Cash-out Refinances
Frequently our borrowers will refinance a property with the intention of pulling cash out. This cash might be used to consolidate bills or to initiate some sort of a project. We can loan up to 75% LTV on cash-out refinances.

-Seller Carry-backs
A common scenario for us involves a borrower that might be relying on a seller to do a partial carry-back, with our lender going in first position. In this case, the borrower may be coming to escrow with little or no down payment, or in fact, may be pulling cash out of escrow. In these scenarios, we can obtain financing up to 75% LTV and a maximum of 120% CLTV.

-Bridge Loans - as short as 3 months
Many of our borrowers need short-term solutions, without painful pre-payment penalties. We recognize that private-money is often a short-term solution, and strive to offer reasonable solutions for borrowers needing the money for as little as 3 months. And on certain occasions, we will actually write a loan with no pre-payment penalty or minimum interest.

-Fast Closings - less than one week is possible
We generally require about two weeks to do a loan, but will do EXPRESS closings in one week or less. We charge an extra point for this service, but can generally succeed as long as we have the full cooperation and support of the borrower.