FAQs — AFIC

Frequently Asked Questions

“Hard Money” is another word for private lending or nonbank mortgage finance loans back by real estate. Terms and process are easier than a bank. Rates are typically, but not always, higher. Underwriting and underwriting standards are far easier than bank or other real estate backed financing or loans.
A Private Lender is the more current term for a provider of Hard Money Loans. It is a nonbank mortgage finance company or private individual engaged in making real estate backed loans.
Net Operating Income (NOI) is a property’s net income before paying expenses relating to property financing, leasing, or tenant improvements. It also can be referred to as a property’s EBITDA. A lender will commonly review NOI before making a real estate loan.
Debt Service Coverage Ratio (DSR or DSCR) is a common math formula in real estate lending where the numerator is the property NOI and the denominator is the annual property debt service. A DSCR over 1.0 means the property is cash flow positive.
Estoppel(s) in real estate mortgage finance refers to documents executed by tenants where they represent certain facts and circumstances surrounding their property lease. They are typical to many real estate loans.
Subordination Non-Disturbance and Attornment (SNDA) agreements are agreements for your tenant(s) where your lender and tenants agree that any tenant lease is subordinate to the lender’s security interest in the property, the lender won’t bother your tenant if they take over the property, and that the tenant will look to your lender as if it were the landlord, should the lender end up with the property. They are not common in hard money or private lender loans.

Property Types used to Secure a Line of Credit

Loan Products

Revolving Line of Credit

Pay interest when you need the money, not when you don’t. Our loan process is as painless as they come, but why go through a loan closing, when your money can be a 1-line email away.
Equity Cash-Out

Some of our best terms are reserved for seasoned owners at lower loan to values. People that need to capture just some of their equity. These are our favorite customers.
Refinance

Whether you want a fresh start, are looking for different terms, or have a distress situation from which you need relief, we are equipped to refinance your current property encumbrances. We make it easy!
Second Liens

Some lenders don’t have the expertise, sophistication, or risk appetite to provide additional financing behind an existing 1st lien, but we do. Why give up a really attractive rate on your mortgage, when you don’t have to?
Acquisition

Buying a property can be really challenging. Your mortgage financing or loan doesn’t have to be part of that challenge. Transparency and competency in your lender go a long way to ensure your transaction closes smoothly.
Development

Developing property is both challenging and rewarding. We have developed and redeveloped property. Get mortgage financing from someone that has been in your shoes.
Equity

Raising equity or “dialing for dollars” can be a job in and of itself. We have both raised money for projects and invested in others acquisitions, redevelopments, and developments.