FAQ

Contact Us

Frequently Asked Questions about Hard Money Lending

Are you direct lenders?

Answer: Yes, we are direct private lenders. We are not brokers. We can make same day decisions on loans.

Where do you lend?

We will lend nationwide, except NV, SD, ND, and VT, as long as the sponsor has experience and cash for the down payment, closing costs, and monthly interest payments.

Do you lend on as-is or the future value of the asset?

We lend based on the future value of the asset (ARV).  We do not perform a valuation on the as is value.

How do you calculate the value of properties?

We use third-party independent appraisers for each transaction.

What types of properties will you lend on?

We provide loans for single family homes, rowhouses, townhouses, condos, and 2-4 unit properties.

Do I need to use my own capital?

Yes, we require that borrowers have equity in each transaction.

What percentage of ARV will you loan against?

We will provide up to 70% of ARV.

What are your rates and fees?

Our interest rate typically is 10% and our fees are anywhere from 2-3 points.

Do you pull credit?

Yes, we do pull credit scores on your first deal.

Timing and Closing

How fast can you fund a transaction?

Once we receive all the required documents, we can fund a transaction in about 2 weeks.

How quickly can I get a commitment?

We can give same-day commitments if we have a completed application. Rehab & Construction Loan FAQs

Rehab & Construction Loan FAQs

How is the construction or rehab budget factored into my loan?

If you have chosen to finance construction or renovation costs, the amount of the construction budget will be deducted from the funds disbursed to you at closing. For example, if your total loan amount is $200,000 and the construction budget is $75,000, only $125,000 will be disbursed at closing, with the balance held for future construction draws.

Is a licensed general contractor required?

It depends on the scope of work. If the renovations are minor, no building permits are needed, and you have documented experience with prior projects, the use of a licensed general contractor may not be required.

How will construction or rehab funds be allocated?

During underwriting, you or your contractor will be required to submit a scope of work and draw schedule that identifies the cost of each task to be performed, and groups these tasks into draw requests. When the work in each draw request is complete, the specified cost of the completed work will be disbursed to you.

What is the process for requesting a draw?

Upon the completion of work specified in the draw schedule, you may submit a draw request by contacting us directly. We will then schedule an on-site inspection of your property, during which an inspector will confirm the accuracy of the draw request and validate that the amount of work actually completed matches the requested draw payment.

How many draw requests may I make?

Most loans are structured with between two and four draw requests, though some more complex projects may have up to six (six is generally the maximum). Your loan fees at closing will be based on the number of anticipated draw requests and, if you exceed this amount, a fee will be charged for each additional draw.

How long does it take to receive a construction draw?

Several factors determine the time needed to process a construction draw (such as access to the property, the accuracy of the draw request, etc.); however, provided that there are no issues, most draws are paid within two to three business days.

May a draw request be made for up-front contractor deposits?

No – construction draws may be submitted for completed work only, and you may not draw from your construction or rehab loan to pay upfront deposits to contractors. As the property owner, you are responsible for the payment of any deposits required by contractors prior to the completion of work.

Will construction draws be paid to me or directly to the contractors?

In general, construction draws are paid to you as the borrower, though in some cases we may approve payments directly to contractors. In all cases, prior to releasing subsequent draws, evidence must be obtained (in the form of lien releases, etc.) that all amounts from prior draws have been appropriately paid to all contractors and vendors.

What if the inspector finds issues during the inspection?

If the inspector notes any issues with the draw request, such as work not fully completed or work not completed in a satisfactory manner, the amount of the draw request will be reduced to match the amount of work actually complete. In such event, the uncompleted work may be included in a future draw request upon completion.

What if my costs increase?

As the property owner, cost increases (whether due to overruns or changes in the scope of work) are solely your responsibility. While we strive to give you flexibility in the management of your project, Infinity Capital Finance is only responsible for disbursing the amounts budgeted for each item in the Draw Schedule. If specific items end up costing more, you are responsible for any difference between the actual and budgeted costs.

Additionally, at each draw request, we will validate that the remaining, undisbursed construction budget is sufficient to complete the project in accordance with the original scope of work. If the remaining budget is deemed to be insufficient due to cost overruns or other reasons, you may be required to pay a portion of the construction costs in order to bring the project back into balance with the construction loan.

Will construction draws be paid to me or directly to the contractors?

In general, construction draws are paid to you as the borrower, though in some cases we may approve payments directly to contractors. In all cases, prior to releasing subsequent draws, evidence must be obtained (in the form of lien releases, etc.) that all amounts from prior draws have been appropriately paid to all contractors and vendors.

What if I complete the project under budget?

If construction or rehab funds are still available after the project has been fully completed, we will disburse those funds to you, provided that the loan is not in default.

Getting Started

How do I get started?

Answer: You can provide the basic information about your transaction here to get started.