5 Question We Hope You’ll Ask When Borrowing from Us

Here at Actium Partners, we are big proponents of borrowers getting the best possible funding solution to meet their needs. We understand that hard money is a competitive business. We also know that borrowers have to look out for their own best interests. Believe it or not, we truly appreciate those who do.

Given the clientele we serve, we expect to be asked questions. We expect applicants to want to know more about what we do and how we can help them. If you are asking questions, you are looking to know as much as you possibly can before you agree to sign on the dotted line.

With all of that said, here are five questions we hope you will ask when borrowing from us:

1. What are the points on this loan?

Nearly every sizable loan comes with points. Hard money loans are no exception. We hope you’ll ask us what the points are on your loan. Better yet, ask us if they are origination or discount points. There is a difference between the two.

Note the points are determined mainly by the size of a loan. One point is usually equivalent to 1% of the loan’s total value. However, points are applied differently based on whether they are origination or discount points.

2. What are the total fees on this loan?

First-time borrowers are often confused about how hard money works. Like traditional financing, there are a range of fees associated with borrowing from hard money lenders. Those fees are above and beyond interest and points. It is important that you understand all the fees and charges you will be assessed. Otherwise, how can you determine the amount you can truly afford to borrow?

3. What makes your offer different from competitors?

Hard money is similar to traditional financing in that different lenders can make different offers on the same project. In other words, we hard money lenders are not afraid to compete. Feel free to ask us how our offer differs from offers you’ve received from other private lenders. We are more than happy to explain what makes Actium Partners different.

4. What information do you need to make a decision?

This particular question is one we appreciate being asked in the early stages of our relationship. In fact, asking on initial contact is best. Why? Because getting us all the required information upfront increases the chances that we will get your project funded quickly. If we have to wait a week or more for you to put together your proposal, your project just sits on hold for that much longer.

5. How will you determine the amount I can borrow?

We base loan amounts on two main factors: loan-to-value (LTV) ratio and the value of the asset being offered as collateral. In terms of the former, LTV is the standard amount we will loan, determined as a percentage of the asset’s value.

It’s important that we see sufficient value in the asset as compared to the amount you want to borrow. That value plays into how we evaluate the risk we are being asked to assume. The lower the loan amount, in relation to the asset’s value, the easier it is for us to make a loan offer you will appreciate.

If you are considering pitching us for a hard money loan, we welcome your questions. Do not be afraid to ask. We want you to be fully informed so that you can make a wise decision. We want to help by answering your questions truthfully and thoroughly.