Property investors that are fixing and flipping properties are the most common customers of RD Advisors fix-and-flip loans. Anyone buying properties for commercial purposes on market or in distress, rehabilitating , and reselling is a potential customer for us.
The first step is to fill out an application on this website. This application is simply a way for us to look at your needs and not an offer or a final application for a loan. If we think there is a viable deal, we will you send a term sheet and ask for a $2,500 deposit. This Term Sheet will contain indicative terms and outline an indicative proposal containing the entire deal structure and all key closing costs. If you decide you like our terms and would like to continue the process, the first cost you will incur is the appraisal cost (paid directly to the appraiser), which varies with the type and size of the property. You will not be asked for any money from us until we send you a term sheet outlining the entire deal structure and all deal costs.
We do not require any initial paperwork other than filling out the application on this website. However it is very helpful to us if you provide us with a deal summary. It is also helpful if you also have a purchase contract and a proposed scope of work. The more you provide to us upfront, the easiest it is for us to decide to make a loan to you.
Our loan structures vary and are customized to your needs. Nevertheless, if we had to name a typical structure, it would be a one year loan with no principal amortization until maturity.
Our funds are primarily senior secured lenders, but will evaluate mezz positions on a case by case basis.
Yes, on a case by case basis.
Yes, on a case by case basis, we can lend up to 85% of the purchase price and up to 100% of the rehab costs.
Our borrowers request a draw. Then, typically within 48 hours, one of our licensed contractors inspects the work completed. Finally, typically within 5 days after the inspection, the funds are released. There is usually a $175 charge for each draw that is deducted from the draw amount. Our funds do not make any money on construction draws. The cost of the draws goes directly to our inspectors to ensure that the work is done properly and within code.
We do not have a minimum credit score, however, we do examine our borrower’s credit, and look at payment patterns. If your credit is poor we will look for other parts of the deal that make it safer for us. However borrowers may qualify for enhanced rates with 680+ FICO.
We contract with FCI Lender Services to service and accept payments for your loan. You will receive a full welcome package with instructions directly from FCI within 2-3 weeks of closing. Your payment will be due on the 1st of the month and the automatic Automated Payments (ACH) form from FCI should be completed.
To request a payoff, please request directly from our servicer, FCI Lender Services. Please have your recent statement or account number to provide to FCI. RD Advisors cannot process a payoff directly because the servicer maintains your daily account balance and year-end interest tax reporting.
Loans are made in our discretion and depend on a variety of factors, including borrower’s experience. We could potentially lend up to 85% of purchase and 100% of rehab and up to 75% of ARV.
Although RD Advisors’ concentrate in certain states and areas, it will consider loans on a case by case basis. Nevertheless, most of our loans are in the northeast
RD Advisors’ funds currently make fix-and-flip loans at rates between 8.95%-12%. But this may not reflect your rates. These terms may change at any time. In addition, actual rates and other terms may vary based on approval criteria, including but not limited to FICO score, credit and background checks, previous experience, period of ownership, etc.
The following property types are eligible for our fix-and-flip loans:
- Single Family Residence (SFR)
- 2-4 Unit Properties
Currently, the fix-and-flip loans of RD Advisors’ funds have a minimum principal amount of $200,000 and a maximum principal up to $3M. But this may not reflect your loan amounts. These amounts may change at any time and RD Advisors may make exceptions in its sole discretion. Actual amounts offered and other terms vary based on approval criteria.
We do not have set income requirements for the borrower, but the borrower must be able to demonstrate the ability to pay scheduled interest.
RD Advisors requires various documentation that depends, among other things, on the type of loan requested, the nature of the collateral and the borrower, the underwriting requirements and conditions, the results of due diligence, and various other factors. If you are interested in our fix-and-flip loans, at a minimum, after we issue the term sheet, we will ask you for the following:
- 3-months bank statements
- 1-Year of Personal Tax Returns
- Sales Contract (on purchase)
- AML/KYC documentation, including operating agreements and certificate of formations for LLC and identity documentation.
No. Currently, RD Advisors’ funds only provide loans for commercial purposes collateralized by investment properties that are not owner-occupied.
No, typically there is no prepayment penalty on our 12-month fix-and-flip loans. Nevertheless, our funds do require a minimum of 3 months of pre-paid interest which you will forfeit if you repay early. This minimum can often be higher, can change overtime and terms may vary based on approval criteria, including but not limited to FICO score, credit and background checks, previous experience, period of ownership, etc.
Yes, we lend to borrowers with all types of experience.
Rehab funds are disbursed through reimbursement of expenses. A maximum amount is set at loan origination but the funds are disbursed only as and when the borrower has demonstrated to the satisfaction of RD Advisors and its funds that the work has been completed.
Yes, to go through the application and evaluation process, RD Advisors typically requires a $2,500 deposit. That deposit is credited toward closing costs at closing. There is also a $175 drawdown inspection fee (typically $175 per drawdown), a legal fee (typically $1,500), a fee for appraisal/budget feasibility review (typically $510, varies depending on property type) and a fee for background/credit checks (typically $180). These fees may change at any time. In addition, these fees may not be applicable to you. Actual fees may vary based on various approval criteria or in RD Advisors’ sole discretion. Please look at your term sheet for applicable fees.
Turnaround times vary from deal to deal, and depend on various criteria, that include your responsiveness. We can closed deals as quickly as 10 days 7 days from the time a client is onboarded. We cannot guarantee a turnaround time.
Yes, there are plenty of properties we do no lend on, even if they meet all of our other criteria. We decide to lend in our sole discretion. Nevertheless, as a rule, our funds currently do not lend on primary residences, mobile homes, co-ops and our funds typically do not lend on properties we consider too rural or too remote from urban centers.