What types of properties do you lend on?
We lend on non-owner occupied multifamily properties with 5+ units. We can also lend on mixed-use properties depending on the structure.
Do you finance new construction?
No. Our loans are for value-add rehab to existing multifamily properties. We do not lend on new construction.
What if my property does not need rehab?
We offer a short-term bridge for the purchase or refinance of stabilized multifamily properties.
What is the max leverage offered?
We can lend up to 80% of total cost (purchase + rehab) for rehab loans and 75% of value for stabilized properties.
Do you offer long-term financing?
No. Currently, we offer short-term bridge products for stabilized properties and properties in need of value-add rehab.
Is an appraisal always required to fund a loan?
An appraisal is required for all Multifamily. Although the appraisal is an expense for the potential borrower, it protects him or her from making a mistake and owning a new mortgage on a property that is already underwater due to too many foreclosures in the area. Appraisals are the last step in the application and underwriting process. They are conducted only after the borrower is approved and the estimate of cost has been accepted by the borrower. Lima One Capital makes no money off of the appraisals and the potential borrower pays our approved appraisers directly.
How are construction funds managed?
At closing, we hold the funds for rehab back in escrow and release them through a draw process on completed work. Our borrowers request a draw. Within 48 hours, one of our licensed contractors inspects the work completed. Within 24 hours after the inspection report is received, the funds are released. There is a small charge for each draw that is deducted from the draw amount. We don’t make any money on construction draws. The cost of the draws goes directly to our contractors to ensure that the work is done properly and within code.
Are there any upfront fees required?
We require a site inspection with budget review (if rehab is involved), and environmental screening, and a full appraisal for all of our loans. Upon pre-approval, we will collect a deposit for 3rd party due diligence. This allows us to pay the vendors directly, speeding up the process. Any unused funds from the deposit once all due diligence has been completed will be refunded back to the borrower. Lima One Capital does NOT keep any unused funds from a borrower’s deposit.
Do you lend to foreign investors?
Yes, we do lend to foreign investors with our Multifamily program.
How quickly can you close?
We can underwrite a completed application for pre-approval in 1-2 business days. From pre-approval, our average closing time is around 30 days. The overall timeframe is heavily dependent on 3rd party due diligence and how quickly we are provided required documents from the borrower.