High FICO real estate investor and successful business owner sought a $340,000 business purpose 2nd Trust Deed loan on this owner-occupied SFR in Santa Barbara, CA. The borrower was recently awarded an investment property in a divorce which has a few code violations that need to be repaired. To confirm, our subject property is the Owner Occupied Principal Residence and the borrower is using the funds from our loan to fix his recently acquired/awarded investment property. The borrower plans to use a majority of the loan proceeds to bring that property up to code, make some cosmetic improvements, then immediately sell. This is also the borrower’s exit strategy from our loan as the proceeds from that sale will be used to pay this loan off. Any remaining loan proceeds will be used for capital investment into the borrower’s Insurance Business.
The borrower’s 1st mortgage is with Mr. Cooper and has a principal balance of $474,611 with a fixed interest rate of 2.625%, maturing September 2051 and a payment of $3,484.53/month. The first lender impounds for taxes and insurance.
The subject property is a traditional styled, 1,268 SF Single Family Residence sitting on a 6,000 SF lot in the beautiful city of Santa Barbara. The home, which was recently renovated, consists of 7 total rooms including 3 bedrooms and 2 bathrooms. The garage is currently being converted into an ADU. The borrower has paid for this rehab out of her own pocket and will continue to do so. Since the garage is in the process of being rehabbed, the two appraisers who reviewed this property did not give any added value but just considered the garage as a ‘storage room.’ Also according to the appraisers, all the ADU permits are in place, all utilities are in order, and there are no health or safety hazards due to the ongoing rehab of the garage. The subject property is located in the heart of Santa Barbara just a short away from UCSB, shopping, entertainment, restaurants and the beach.
What we like about this Trust Deed opportunity:
- Real estate investor and successful business owner
- Beautiful Santa Barbara location
- 58.21% CLTV, 57.30% Net CLTV
- 13.25% Lender Rate
- 3 months Prepaid Interest
- 6 months Guaranteed Interest
