Loan Purpose
Repeat Mortgage Vintage borrower and experienced business owner, sought a business-purpose, non-owner-occupied Blanket 1st/2nd Trust Deed blanket loan to acquire a 17-unit fully occupied multi-family property located on Vermont Avenue in Los Angeles, while cross-collateralizing an existing 5-unit multi-family property on 40th Place in Los Angeles.
Loan proceeds will be used to purchase the $2,500,000 17-unit property. The borrower is pledging approximately $658,000 of equity in the fully occupied 5-unit property as additional collateral. The 40th Place property currently carries a 1st Trust Deed with an approximate $792,000 principal balance current and in good standing, at 8.374% interest, with a payment of $6,125 maturing in 2055.
This loan is structured as short-term bridge financing, interest-only, allowing the borrower time to stabilize operations and execute an exit strategy via refinance or sale. Additionally, the seller is carrying back a $921,000 2nd position loan on the Vermont property, enhancing leverage efficiency while maintaining conservative overall CLTV.
Property Description
The collateral consists of two income-producing multi-family properties in Los Angeles, CA:
1. 6500 S. Vermont Ave – 17 Units (1st Trust Deed Position) 9,445 Living SF, 12,090 Lot Size, 17 Units, each with 1 Bedroom and 1 Bath
- Non-owner occupied
- Fully occupied
- Independent As-Is appraised value: $2,500,000
2. 905 W. 40th Place – 5 Units (2nd Trust Deed Position): 4,746 Living SF, 6,415 Lot Size, 5 Units, each with 1 Bedroom and 1 Bath
- Non-owner occupied
- Fully occupied
- Independent As-Is appraised value: $1,450,000
The combined As-Is value of both properties is $3,950,000.
The new loan totals $1,579,000, plus the existing $792,000 first Trust Deed on the 40th Place property, resulting in a combined loan amount of $2,371,000. This produces a 50,00% CLTV and 48.31% Net CLTV, calculated strictly on As-Is valuations.
Both properties are located in established Los Angeles rental submarkets with zoning supporting continued multi-family use. The properties are subject to local rent control, allowing up to 4% annual increases, with the ability to adjust to market rent upon tenant turnover.
What We Like
- Repeat Mortgage Vintage borrower
- Experienced property management business owner managing the subject properties
- Conservative 50.00% CLTV based on As-Is valuations
- Fully occupied, income-producing collateral
- 1st Trust Deed position on the larger 17-unit asset
- Cross-collateralization enhances overall security
- Short-term, defined 24-month bridge structure aligned with refinance or sale exit
