Find our full suite of collateral-based programs here: https://www.marshallreddick.com/loan-programs.  Specifically, find our short-term renovation programs here: https://www.marshallreddick.com/api/rates/renovate.  These renovation programs are utilized by our borrowers for fix/flip or fix/rent. Keep in mind the fix/rent model requires a refinance, with us or another lender, to a more permanent, long-term loan program since our renovation programs offer at term of 12 months maximum.

In the renovation programs, our 3rd offering, the 12% program, can provide a loan amount equal to 100% of acquisition and 100% of renovation so long as the loan amount does not exceed 70% of the underwriter's opinion of after-renovation-value.  In this case, however, at close of escrow, the initial release on the loan will be 90% of purchase which means the borrower needs to bring 10% of the purchase plus closing costs in order to own/close on the property.  The remaining balance of the loan will be escrowed (when possible) and available for borrower use on the renovation. This amount is referred to as the escrow or renovation hold.

In connection with underwriting and closing, the borrower will provide an itemized and detailed scope of work.  This is helpful for the assigned loan analyst to learn what renovations the borrower has planned for the subject property.  A scope of work is required on all renovation loan programs but is key to this specific 3rd/12% program that includes the borrowing of renovation money.  A detailed scope of work is important and can definitely help borrowers obtain the most favorable opinion of after-renovation value.  Further, this is very important, the borrower will be required to break down the scope into phases and each phase must include the items from the scope that will be completed during that phase.  This process will help the borrower and the analyst come to terms on the loan draw/release schedule for the escrow hold.  The borrower is intimately knowledgeable on the project and is best suited to provide this schedule.  We do not offer a template but the analyst will be happy to give direction if needed.  As long as your draw/release schedule is reasonable, generally it will be accepted.

After closing, the borrower now owns the subject property, gets organized, and will commence the renovation process.  Borrowers will need to complete, using funds from their own pocket (not from the escrow hold), phase 1 of the renovation.  When phase 1 has been completed, the borrower will request draw/release 1 by providing a written progress summary along with a video/photographic walk-through of the collateral asset.  The video/photographic walk-through should always start at the front/exterior of the subject property so the subject property can be clearly identified.  The video/photographic evidence should give a clear view of the entire subject property, externally and internally, but focus on those items completed during that respective phase of the renovation.  The borrower may provide additional evidence (receipts, invoices, etc) to support the completion of that respective phase as desired but isn’t necessarily required to do so.  The assigned analyst, the same analyst who helped from the start, will review the requested draw/release and evidence provided, and, if in good order, will order draw/release 1.  This process, so long as the evidence provided is clear/sufficient, and all the items included in that respective phase are completed, should take no more than 48-72 hours.  No 3^rd party inspector/independent walk-through is required by the analyst reserves the right to call for independent walk-through if uncomfortable with the draw/release request and/or evidence provided.  This process will repeat until all renovation is complete and the escrow hold has been exhausted.

Please note, we are not a bank but rather a private institution thus we have no choice but to charge interest on the full amount of the loan from day 1.  The payments are interest only, due on the 1st of each month, late if not received by the 15th, and are expected to be received on time.  The monthly interest is simply calculated, loan amount x interest rate ÷ 12 months.  The per diem interest, used for odd days at closing or odd days at payoff, is also simply calculated, loan amount x interest rate ÷ by 360 days in a banker's year.

For additional information please call at 949-885-8180 or email at borrow@marshallreddick.com.