Loan Example

1.) Sunkist Reality Corporation goes to the bank and borrows $5,000,000 at 8% with no loan origination fees because it has steady cash flow does not need the money for several months.

2.) The Orange Property Management Corp. does not have a steady income stream but has real estate equity that it can use as collateral to obtain a $5,000,000 hard money loan against it's real estate equity for 10.5% interest plus a 5 point loan origination fee. Alpha Property Management Corp. it's money in 10 days.

Loans come in all types shapes and sizes, and Sunkist Reality wouldn't hear of paying 10.5% with their flawless credit, while Orange Property Management Corp. must pay 10.5% and 5 points to obtain his hard money loan because it needs the money immediately



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