Attentiveness
It is very important that your lender is responsive and attentive to your needs. Your lender should be a second set of eyes on everything – from documents, to the property itself and agreements with contractors – before, during and after your deal. Your lender is one of your resources. They shouldn’t hamper you from completing your deals in a timely manner. The reason you approach a private lender in the first place is because traditional lenders just can’t close those deals fast enough. One of the largest complaints we have heard from investors is that they could never get in contact with their lender in a timely manner. At WCP, we guarantee we will respond to any emails, calls or texts within a matter of hours, if not immediately. We understand how precious your time is and how important it is that you get what you need as soon as possible. It can be scary when the person dealing with your finances is not available for you to speak with when any questions or issues arise. There are some lenders out there that will simply lend you the money you need without offering any additional advice or value to your specific transaction. At WCP, we help you as much or as little as you want, every step of the way.
Size
The size of your lender can really make or break your deal. If you choose a lender that is too small, they may not have all the manpower needed to complete your deal. On the contrary, if the lender you choose is too big, you risk your deal getting lost in the shuffle. At WCP, we consider ourselves a larger lender with a small lender feel. You will meet one-on-one with a specific point person who will be by your side throughout the entire process. While we have many of the benefits of being a larger lender, such as a large amount of available funds and extensive industry experience, you will get the personalized attention that you will usually only find with a smaller lender.
Experience
Your lender should be well-seasoned not only in the art of hard money lending, but also highly educated in your local marketplace. If you choose a lender that is either new to the business or the area, you may be risking your entire deal. Perhaps the lender hasn’t underwritten many deals, or they are not familiar with the local neighborhoods. Most of the time, investors will encounter one or two unexpected obstacles during the process. With an experienced lender, there is a good chance that they have solved similar issues with prior deals, and you will benefit from that knowledge. If your lender is inexperienced, they may not know exactly how to handle these issues, which could put your entire transaction at risk. We have underwritten thousands of deals in the DC metro area, and we understand the unique marketplace in each neighborhood. We know what sells where, so we will be able to provide you with as much advice as you need when it comes to creating the concept for your new property.
Capital
Do your research and make sure your lender is well capitalized. Some smaller lenders may not have the backup reserves to take on multiple clients at a time. They may have to wait for deals to close completely before pushing money back out again to fund other loans. This could delay your own transaction, and might even make you miss out on that great new property.
Organization
Your lender’s organization is very important to your transaction. In private lending, you don’t have all of the regulatory impositions that traditional institutions do. There are some lenders that are not very organized and actually don’t know all that much about hard money lending. There is an intricate, step by step process involved with every transaction. At WCP, we have incredibly advanced systems in place that have helped us improve our efficiency and speed for each deal. Our systems automate the process, from approving a loan to getting draws funded and ensure that everything is completed quickly and efficiently.
Let us know if you have any questions, or want to learn more about what we can do for you!