FREQUENTLY ASKED QUESTIONS ABOUT HARD MONEY LOANS
1
What is a hard money loan?
Hard money (also known as a rehab loan or bridge loan) is the term used for loans funded by private parties who want a safe and high return. Wela Financing is a broker who arranges loans for and sells notes to private investors. We work directly with property buying investors who use these funds to purchase properties with the intent to fix and sell them for a profit in a very short period of time. Sometimes they build new properties or hold properties as rentals.
Real estate investors use hard money when they are unable to or do not have time to obtain financing from more conventional sources. Typical banks won’t fund these properties because of condition or the fact that a full-time investor isn’t typically W2 employee.
There are many types of hard money loans. Wela Financing specializes in purchase money first trust deeds to investors who purchase homes at a substantial discount. Wela Financing will do loans on units. Construction loans will be considered based on the individual deal and existing market conditions. Wela Financing does not do owner occupied or commercial loans. We only do non-owner occupied and business-purpose loans.
2
Do I have to pre-qualify?
Preferably, yes. It saves you time when you have deals ready to go. Apply online today and read the following question to learn more about the process and what we’re looking for in applications.
3
Do you provide a "letter of credit?"
Yes! Upon review of the application, a general letter of credit will be issued to those who qualify. However, this is not a commitment to fund any transaction at any certain amount. Wela Financing is it a “proof of funds” letter.
Amount of the letter of credit will range between $200,000 and $1 million dollars. The amount will be based on experience, ability to make monthly payments, and in a large part, on the client’s cash reserves.
4
What are your terms?
This is your Services Page. It's a great opportunity to provide information about the services.The Wela Financing now has different loan programs to help investors in a multitude of projects ranging from your standard flips and rehabs to new construction loans. See our main hard money loan page for a complete breakdown. We lend in both California and Florida. Costs and fees will vary depending on the program. Entities (Corporations, partnerships, LLCs, etc.) are accepted as are self-directed IRA accounts. Explore the programs to find which best fits your criteria and investor model and the terms for each. We will consider small residential commercial projects on a case-by-case basis. you provide. Double click on the text box to start editing your content and make sure to add all the relevant details you want to share with site visitors.
5
How long does it take to close the loan?
Our can close in as little as 5 business days assuming we have all documentation signed correctly and returned in a timely manner. Lead times may vary by loan program (longer-term and construction loans typically take longer).
Quick closings are possible only with your help! We need all the documentation, escrow instructions, proof of correct insurance, clean preliminary title report, and all docs signed correctly and timely for us to close quickly for you. Speed for your transaction is very dependent on your response time!
Each transaction is handled on a case by case scenario. If there is a special requirement, we may be able to accommodate you but tell us up front what you need on a timeframe.
6
What if I have a bad credit score?
If you have a low FICO score, Wela Financing may still fund your loan but may need you to come up with more cash down to lower our loan-to-value. We’ll likely need to see more cash on hand.
7
Are there prepayment penalties?
On some programs, yes. Our fix and flip and new construction products do not have a prepay penalty. For our Rental Purchase and Refinance Programs, there is a prepay. Please see specific programs for more details.
8
What types of property do you fund?
Wela Financing specializes in non-owner occupied residential, single-family properties from 1-4 units. Our programs range from a standard fix and flip to buy to hold as rentals to new construction. However, if you have small apartment buildings, please give us a call, we may be able to assist you. These are business purpose loans.
We DO NOT offer funding for mobile homes, commercial, or cannabis projects.
Address
843 4th St, Santa Monica, CA, 90404
Phone
(310) 435-2297