Loan Purpose
Mortgage Vintage successfully funded a $200,000 second trust deed business-purpose cash-out bridge loan secured by a non-owner-occupied, two-story multi-tenant commercial office and retail property located in an established business corridor in El Dorado Hills, California. The borrower sought this El Dorado Hills commercial loan to support general working capital, maintain portfolio reserves, cover operating expenses, and fund ongoing property management activities while the subject property was actively marketed for sale. The loan was structured as a short-term bridge solution with a clear exit strategy: the sale of the subject property. Funds were applied toward business-purpose investment activities across the borrower’s broader real estate portfolio.
Why This El Dorado Hills Commercial Loan Stood Out
- The property was 100% leased at closing, generating $11,926 per month in gross rental income from a diverse mix of commercial tenants, providing strong income support for the collateral.
- A recent restricted appraisal review confirmed the property value at $1,900,000, supporting a combined loan-to-value ratio of just 59.84%, offering meaningful equity cushion behind the second trust deed position.
- The loan was structured with 5 months of guaranteed interest and 5 months of prepaid interest at a 14.00% borrower rate, providing investors with predictable, front-loaded returns on a short five-month term.
- The borrower signed on as an individual personal guarantor in addition to the LLC holding title, adding an additional layer of recourse for trust deed investors.
- The property’s net operating income of approximately $105,498 annually reflected a 5.70% capitalization rate on the appraised value, underscoring the asset’s income-producing stability.
Property Description
The collateral securing this loan was a well-maintained, two-story multi-tenant commercial building situated within the historic Village area of El Dorado Hills, El Dorado County, California. The building offered approximately 4,960 square feet of rentable space on a 3,484-square-foot lot and was home to six individual suites occupied by a diverse roster of commercial tenants, including personal service businesses and professional office users. The property was fully leased at the time of funding, with no vacancy, making it a stabilized income-producing asset. El Dorado Hills benefits from its proximity to Folsom Lake and Highway 50, providing the commercial corridor with strong regional accessibility and a desirable suburban location east of Sacramento. This type of stabilized commercial collateral aligned well with Mortgage Vintage’s commercial hard money loan program, which is designed to serve experienced real estate investors seeking flexible, asset-backed financing solutions.
Investment Summary
Mortgage Vintage structured and funded this transaction as a $200,000 second trust deed, positioned behind an existing first trust deed with a balance of approximately $936,907, against a recently appraised property value of $1,900,000. The combined loan-to-value ratio at closing was 59.84%, leaving a substantial equity buffer in excess of $760,000 protecting the trust deed investors’ capital. The loan carried a 14.00% annual interest rate on a five-month term, with both guaranteed and prepaid interest provisions ensuring that investors received their full scheduled return regardless of early payoff. Trust deed investors participated through the CrowdTrustDeed platform, with a minimum investment of $40,000. The loan was secured by a fully occupied, income-generating commercial asset with a personal guaranty from the borrower, and the exit was supported by the active marketing of the property for sale. This transaction is now complete and has been added to Mortgage Vintage’s portfolio of closed trust deed investments.
Financial Details
| Field | Value |
|---|---|
| Loan Amount | $200,000 |
| Borrower Interest Rate | 14.00% |
| Lien Position | 2nd Trust Deed |
| Loan Term | 5 Months |
| Guaranteed Interest | 5 Months |
| Prepaid Interest Minimum | 5 Months |
| Deal Type | Cash-Out Refinance |
| Occupancy | Non-Owner-Occupied (NOO) |
| Combined LTV (CLTV) | 59.84% |
| Appraised Value | $1,900,000 |
| 1st TD Balance | $936,907 |
| Minimum Investment | $40,000 |
| Loan Program | Commercial Hard Money |
| Status | Completed |
Property Highlights
| Field | Value |
|---|---|
| Property Type | Commercial Office / Retail (Multi-Tenant) |
| Location | El Dorado Hills, El Dorado County, CA |
| Building Size | Approx. 4,960 Sq. Ft. Rentable Area |
| Lot Size | 3,484 Sq. Ft. (0.08 Acres) |
| Number of Suites | 6 |
| Stories | 2 |
| Occupancy Rate | 100% Leased |
| Gross Monthly Rental Income | $11,926 |
| Annual NOI | $105,498 |
| CAP Rate (on Appraised Value) | 5.70% |
| Appraised Value | $1,900,000 |
| Tenant Mix | Personal Services, Professional Office |
Frequently Asked Questions
Why would a real estate investor use a second trust deed cash-out refinance on a fully leased commercial property?
A second trust deed cash-out refinance allows a property owner to access equity in a stabilized, income-producing asset without disturbing the existing first mortgage. In this case, the borrower used the proceeds for general working capital and portfolio-level operating expenses while the property was being marketed for sale. Because the property was 100% leased and generating consistent rental income, the collateral remained strong even while the loan served a short-term liquidity purpose. Hard money lenders like Mortgage Vintage specialize in structuring these bridge solutions quickly and efficiently when conventional lenders cannot.
What protections did trust deed investors have in this second lien position commercial deal?
Despite occupying the second lien position, investors in this trust deed benefited from several layers of protection. The combined loan-to-value ratio was just 59.84% against a recently appraised value of $1,900,000, leaving more than $760,000 in equity ahead of any loss scenario. The loan was further supported by a personal guaranty from the borrower, guaranteed interest provisions covering the full five-month term, and prepaid interest that was collected upfront. The property itself was fully occupied and income-generating, providing ongoing cash flow that supported the collateral’s value throughout the loan term.
What makes El Dorado Hills a viable market for commercial hard money lending?
El Dorado Hills is a well-established, affluent suburban community in El Dorado County, California, situated along the Highway 50 corridor east of Sacramento. Its proximity to Folsom Lake, strong household incomes, and steady population growth have supported consistent demand for local commercial services and professional office space. The historic Village district, where this property was located, has proven to be a durable retail and office destination. These market fundamentals make El Dorado Hills an attractive location for asset-backed commercial lending, as stabilized properties in the area tend to hold their value and maintain occupancy even during broader economic fluctuations.
Mortgage Vintage, Inc. is a California DRE-licensed hard money lender and trust deed investment company with extensive experience structuring and funding commercial bridge loans, second trust deeds, and cash-out refinance transactions for real estate investors throughout California. With a disciplined underwriting approach and a deep understanding of collateral-based lending, Mortgage Vintage has built a track record of successfully closing complex transactions that serve both borrowers seeking flexible financing and investors seeking asset-backed yield opportunities in the trust deed marketplace.