Loan Purpose
Mortgage Vintage successfully funded a $400,000 business-purpose cash-out loan secured by a first trust deed on a luxury condominium located in the prestigious Century Park East community of Century City, Los Angeles County, California. The borrower had recently acquired the property and sought financing to support business-purpose investment activities while completing an extensive interior renovation of the non-owner-occupied rental unit. The property was owned free and clear at the time of funding, and loan proceeds were deployed for general business purposes. This business-purpose cash-out loan program provided the borrower with timely, flexible capital that conventional lenders could not deliver given the property’s mid-renovation status.
Why This Century City Condo Loan Stood Out
- Luxury high-rise first trust deed paying investors 10.99% annually in a premier Los Angeles submarket.
- Conservative 58.82% LTV and 55.00% Net LTV based on the as-is appraised value of $680,000, with a compelling after-repaired value of $990,000 providing substantial additional equity cushion.
- Property was owned free and clear with zero existing mortgage debt, eliminating senior lien risk for trust deed investors.
- Borrower demonstrated an exceptional 813 middle FICO score with no late payments, collections, or derogatory credit history.
- Prime Century City location adjacent to Beverly Hills and Fox Studios, supporting strong long-term demand and rental income potential estimated at $5,500 per month upon renovation completion.
- Clear and credible exit strategy: conventional refinance upon completion of repairs and restoration of kitchen and bathroom functionality.
- Six months of guaranteed interest and a six-month prepayment premium provided investors with income certainty and downside protection.
Property Description
The collateral securing this Century City condo loan was a one-bedroom, two-bathroom unit in a 21-story luxury high-rise condominium tower within the Century Park East development. The unit offered approximately 1,070 square feet of living space and included one detached parking space. Community amenities included a pool, spa, concierge services, and sweeping city views. Originally built in 1966, the complex comprises 480 condominium units across two towers. At the time of funding, the unit was vacant and undergoing a complete interior renovation, with the kitchen and bathrooms temporarily non-functional. HOA dues were $1,680 per month. The as-is broker price opinion established a value of $680,000, with an after-repaired value of $990,000. Investors can review funded deals like this one through the CrowdTrustDeed platform, where Mortgage Vintage posts its trust deed investment opportunities.
Investment Summary
Mortgage Vintage originated this $400,000 first trust deed at an interest rate of 10.99% with an 18-month term, six months of guaranteed interest, and a six-month prepayment interest provision. The loan-to-value ratio came in at 58.82% against the as-is value of $680,000, with a net LTV of 55.00% after accounting for prepaid interest. The borrower entered the transaction with strong credit credentials and a property acquired free and clear, providing trust deed investors with a well-collateralized, income-producing position in one of Los Angeles’s most recognized luxury residential communities. The planned exit via conventional refinance upon renovation completion represented a straightforward and realistic repayment pathway supported by the property’s significant after-repaired value upside.
Financial Details
| Field | Value |
|---|---|
| Loan Amount | $400,000 |
| Interest Rate | 10.99% |
| Lien Position | 1st Trust Deed |
| Loan Type | Cash-Out / Business Purpose |
| Loan Term | 18 Months |
| Guaranteed Interest | 6 Months |
| Prepayment Interest | 6 Months |
| As-Is Value (BPO) | $680,000 |
| After-Repaired Value (ARV) | $990,000 |
| LTV (As-Is) | 58.82% |
| Net LTV (As-Is) | 55.00% |
| Occupancy | Non-Owner Occupied |
| Borrower FICO (Middle) | 813 |
| Exit Strategy | Conventional Refinance Post-Renovation |
Property Highlights
| Field | Value |
|---|---|
| Property Type | Condominium |
| Location | Century City, Los Angeles County, CA |
| Building Type | 21-Story Luxury High-Rise |
| Year Built | 1966 |
| Living Area | Approx. 1,070 Sq. Ft. |
| Bedrooms / Bathrooms | 1 Bed / 2 Bath |
| Parking | 1 Detached Space |
| Amenities | Pool, Spa, Concierge, City Views |
| HOA Dues | $1,680 / Month |
| Est. Rental Income (Post-Renovation) | $5,500 / Month |
| Total Units in Complex | 480 (Two Towers) |
| Existing Liens at Funding | None — Owned Free and Clear |
Frequently Asked Questions
Why would a hard money lender fund a cash-out loan on a condo that is mid-renovation?
Hard money lenders like Mortgage Vintage evaluate collateral value, equity position, and borrower creditworthiness rather than relying solely on the property’s current functional status. In this case, the as-is value of $680,000 supported a conservative 58.82% LTV against the $400,000 loan amount, and the borrower entered the transaction with an 813 FICO score and no existing liens. The significant gap between the as-is value and the after-repaired value of $990,000 provided additional downside cushion for trust deed investors, making the mid-renovation status a manageable and well-underwritten risk.
What does “Net LTV” mean in a trust deed investment, and why does it matter?
Net LTV — or Net Loan-to-Value — represents the effective loan-to-value ratio after accounting for costs such as prepaid interest that reduce the actual funds advanced to the borrower relative to the property’s value. In this Century City condo loan, the gross LTV was 58.82%, while the Net LTV came in at 55.00%, reflecting the six months of prepaid interest built into the loan structure. A lower Net LTV generally means the lender’s position is better protected, since the effective exposure against the collateral is reduced. Trust deed investors often focus on Net LTV as the more conservative measure of their security.
What is the typical exit strategy for a business-purpose cash-out hard money loan on an investment condo?
The most common exit strategy for this type of loan is a conventional refinance once the property is stabilized — meaning repairs are completed, the unit is rentable or rented, and the borrower can qualify under standard underwriting guidelines. In this Century City transaction, the borrower’s plan was to complete the full interior renovation, restoring the kitchen and bathrooms to functional condition, and then refinance into a conventional loan supported by the property’s higher after-repaired value of $990,000. This represents a well-defined and realistic repayment pathway, which is one of the factors Mortgage Vintage evaluates when underwriting bridge and cash-out hard money loans on investment properties.
Mortgage Vintage, Inc. is a California DRE-licensed hard money lender and trust deed investment company with extensive experience originating and servicing business-purpose loans secured by residential and commercial real estate across California. With a disciplined underwriting approach and a track record of successfully funded transactions in competitive Los Angeles submarkets, Mortgage Vintage provides both borrowers and trust deed investors with the expertise, transparency, and regulatory compliance they need to transact with confidence.