If you (your family or your employees) are living in the property (single family residence or a 2-4 unit residential property) or the loan is for personal, family or household use, the loan is classified differently by federal and state law and we would not be allowed to offer these loans or would have additional process and administrative requirements. Therefore the restriction that you, your family and employees may not occupy, reside in, or live at the property is strict and is expressly prohibited in our loan agreements. Additionally we like lending for investment purposes only and do not want to be put in the position of ever having to potentially foreclose on someone’s home.
We can work with borrowers to utilize a “soft pull” credit history service such as CreditKarma.com (and avoid hard credit checks).
It is important to us to know if potential borrowers are in currently in financial trouble. We are a hard money lender, so our loan decisions are primarily based on the underlying value of the property (“hard asset”); However, even as hard money lenders, we do consider recent credit related behavior among other factors. We will typically review credit history for each human borrower. We are not looking for a minimum credit score, but will evaluate recent credit history focusing primarily on the following aspects:
- Related recent bankruptcies
- Related recent foreclosure proceedings
- Recent history of late payments
- Currently owed payments that are past due
We look at the each loan as a whole package including the asset, the borrowers and the market.
(Good Funds Lending, LLC provides hard money loans in the Colorado Denver Metro area)
For the pre-approval application, we will perform a cursory evaluation of your financial estimates for the project (purchase/acquisition cost, rehab budget, after repair value), and your level of experience and your answers to few other questions. If we believe there is a reasonable likelihood that we would make a loan based on the information provided, we will inform you that you are pre-approved. If approved, and you request a pre-approval letter (Often pre-approval letters are submitted with offers on properties; however, some borrowers may choose to complete a pre-approval application after the property is under contract). A pre-approval is not a guarantee that the loan will be approved or made.
For the full application you provide more details regarding the project and your experience. We more carefully review the borrowers and project. We evaluate the current and after repair value of the property and closely review the expected repair/rehab costs. We examine credit history (via a “soft pull” working with the potential borrowers using a service like CreditKarma.com or a “hard credit check”) of all human borrowers. We do not look for a minimum credit score, but primarily focus on your credit activities/events in the last two years. Prior to making a decision on a loan commitment we typically do a property walk through with one of the borrowers.
At some point prior to a loan commitment we need to meet all human borrowers on the loan and take a picture of each driver license (or State ID) and do a property walk through.