Keystone's Keys to Private Lending
Exit Strategy(s): Evaluate borrower's clear plan for repayment, be it through property sale, refinance, or other agreed-upon means. Having a back up exit strategy is always a plus!
Equity: Ensure substantial equity in the property. The more equity in the property, the stronger the security of the loan.
Loan-to-Value (LTV): Be cognizant of the LTV ratio, with a ‘sweet spot’ being 65% LTV. Urban areas may be considered a bit higher (up to 75% LTV), while rural would be lower (50% or less)
Property Location: Properties in stable, appreciating neighborhoods with a track record of demand will have a high likelihood of approval. More rural areas will need strong exit plans to be considered.
Property Marketability: Assess the property's appeal to potential buyers or renters. A well-maintained, desirable property ensures a quicker exit.
Client Profile:
Income: Can the client service the loan payments for the loan? What about if renewal is needed?
Credit: Consider a healthy credit history for added assurance. A lower score due to high utilization is not necessarily a bad thing!
Residential or Multi-Unit Property Only: We prioritize borrowers with single family multi-unit residential properties. Condo’s, Townhomes, and new Construction are also considered.
Other Key Factors to consider:
Interest Only: Loans are always Interest Only payments, making it easier for your clients cash flow.
Open term: Loans are almost always Fully Open term, so there are no penalties to pay down or pay off the loan.
Creative: We offer creative solutions, flexible rate/fee mix, and – brokers set their fee!
Speed: We can close deals FAST – often in three business days or less!
Remember, a thorough evaluation of these factors will lead to higher likelihood of approval. For personalized advice, please reach out to us anytime! Contact@keycap.ca or 902-818-5262.
