American Heritage Lending | Private Money Guidelines & Pricing

– Hi, I’m Dave Orloff. – Hi, I’m Justin Smith. – And we work at American Heritage Lending located in Costa Mesa, and I’ll let Justin tell you a little bit more about the loans we do. – We’re a residential transitional lender, and we focus on bridge loans, lender-funded fix and flip, your traditional hard money loans, as well as long-term investment loans. We’re a national lender. There’s a few states
that we don’t lend in. We lend in loan amounts
from 75,000 up to 5 million. Your traditional cash-out,
hard money loans, we lend up to 70% cash-out, we’ll do 75% rate-and-term. On your lender-funded
fix and flip properties, we’ll do 85% of the purchase price, 100% of the rehab, as
long as we don’t exceed 70% of the ARV. – [Interviewer] And
ground-up construction? – That’s your department. – We do. We’ll go as high as 85%
loan-to-cost on that, and we typically work
with experienced borrowers who’ve done that kind of project before. – [Interviewer] And will you participate in the land acquisition, or does the borrower just
have to have the land, and have permits ready to build? – We will lend up to 50%
of the acquisitional land. – [Interviewer] So, you won’t just do the separate land loan, it has to have the
construction component as well? – Correct. – That’s correct.
– Yeah. – [Interviewer] And
then, could you tell us about your pricing, in terms
of rates, and interest rates, and fees, and origination,
and other things like that? – You want the secret sauce? – [Interviewer] Yes, exactly. (laughs) – So, interest rates tend to be around 9%. We go down to 8% for the right borrower. If they’re experienced, and they do a lot of business with us, and it’s the right loan, we’ll go lower. Fees, typically as low as 1%. Depending on the type of loan, we have seen fees be around
three points per loan. It really depends whether we’re doing a lender-funded fix and flip with a broker, or we’re working directly
with a developer. It depends if we’re doing a bridge loan for somebody who has
extenuating circumstances that we need to overcome. So, it really depends upon the loan, but to give you a range, somewhere between 8 and 10%, and somewhere between 1% to 3% of points. – I feel some of the benefits, we’re backed by a very large hedge fund. So, we’re not gonna run out of capital, and we come from 20 years of just traditional mortgage banking experience. So, we’re not new to the game, we’re not even new to the
newer products in the game. We’ve seen all this stuff
for the last 20 years, so you’re gonna get what you’d expect, and hopefully we’d
exceed in service levels. We’re very well-backed
from a capital perspective, and then I think we have
deep, deep knowledge in traditional mortgage banking. So, if there’s title issues, or if there’s borrower issues that other people struggle with, I think it’s something we
will have seen in the past, and we’ll have solutions for.

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