What are the risks to lending on After Repair Value (ARV)? The After-Repair Value (ARV) estimates the future value of a distressed property after it’s been repaired. ARV is not a property’s current value when purchased but rather the estimated value of the property once improvements are made. ARV is commonly used by fix and…
One of the most important underwriting elements for Hard Money Lenders and Trust Deed Investors is the Loan to Value Ratio (LTV). The Loan to Value Ratio is defined as the Loan Amount divided by the Value of the property. The question is: Which Value? LTV provides guidance for lenders and investors on how much…
One of the many things I enjoy about the Real Estate business is that each property and loan scenario is unique. Real Estate is not a commodity as every property and borrower has different characteristics that impact value. A personal or trusted associate property visit before making a hard money loan always provides useful underwriting…
How do you get an accurate value on properties? The primary underwriting criteria for a Hard Money Loan is the Value of the Property being used as Collateral. The Internet, new government regulations and the Housing meltdown have all forced Lenders and Service Providers to invent and utilize new valuation metrics and products. The…