Lending Loan Criteria | Private Leverage

Loan Size

$75,000 to $1,000,000
Private Leverage will consider loans with a total principal balance greater than $1,000,000 on a case-by-case basis.

Loan Purpose

Residential business purpose or Commercial:

Acquisition
Refinance

Loan Strategy

Renovation loans:

Fix and rent
Fix and refinance

Bridge loans:

Rental
Hold with no renovation and no rental

Property Types

Single-family residential (1-4 units). Land, Commercial Property or Ground up Construction

Loan-to-Value (LTV) Maximum

Maximum loan advance rates:

80% of “as-is” loan-to-value (LTV)
90% loan-to-purchase-price (LTPP), for acquisitions
70% loan-to-after-repair-value (LTARV), for loans with construction reserves

65% LTV for refinance (6 month seasoning for cash-out)

Loan advance rates are contingent on loan terms, loan strategy, FICO, borrower experience, and other characteristics

Term

3 to 24 months

Occupancy

Non-owner occupied only for residential properties.

Lien Type

First-position trust deeds and mortgages.

Location

Texas Metropolitan Statistical Areas (MSA), Counties, Principal Cities, and MSA Non-Principal Municipalities with greater than 100,000 Residents

Participation

Co-lenders may retain a B-piece or have the option to participate side-by-side with Private Leverage in a pari passu position.

Junior Liens

Allowed with intercreditor agreement. All subordinate liens must be co-terminus with or mature after the first mortgage (or deed of trust).

Recourse

Recourse in the form of a personal guaranty is required for entity borrowers, including trust borrowers. At least one guarantor must be an owner of the borrowing entity. Individual borrowers are allowed.

Multi-Collateral

Subject to all properties conforming to Private Leverage's credit box.

Loan Documents

Must use documents provided or approved by Private Leverage.

Valuation

Private Leverage requires a valuation on all properties. Acceptable forms include appraisals, residential evaluations, and interior BPOs (broker’s price opinion). Use of Private Leverage approved valuation vendors is highly recommended. Loans over $250,000 require an appraisal. Loans with construction reserves require an appraisal for the after-repair value (ARV).

Construction Management

Private Leverage requires approved third-party construction management to oversee the draw process, including inspections. Upon submission of draw requests, Private Leverage will collect third-party progress inspection reports, lien releases, and receipts in order to determine approval of the draw request. Loans with construction reserves that exceed $250k or 40% of the unpaid principal balance are subject to a higher level of due diligence.

Servicing

Private Leverage retains a sub-servicer.

Borrower Type

Individual or U.S. entity required.

Borrower/Guarantor Credit Score

Minimum credit score of 620 for the borrower/guarantor is required. Private Leverage will obtain an updated credit score if the credit report provided in the loan file is over four months old.

Bankruptcy

The borrower/guarantor must be at least one year removed from discharge/dismissal

Borrower/Guarantor Track Record

At least one previous project is required for renovation loans
No track record is required for rental loans

OFAC (Background) Checks

Required for all borrowers and guarantors.

Borrower Eligibility And Documentation

A U.S. Citizen or a permanent resident alien. If the borrower is a U.S.-domiciled company, then a Certificate of Good Standing must be provided.

Title Insurance

Private Leverage requires all of the following to be provided:

TLTA form policy
Minimum coverage of 100% of loan balance
Signed escrow instructions
Copies of all title exceptions to review, if requested
All loan files that contain a title commitment or preliminary title report issued by a title agent, on behalf of a national title insurance company, must include a closing protection letter with ISAOA/ATIMA language; if the file contains a final title insurance policy, a closing protection letter is not required.

Property, Casualty, Liability, and Other Insurance

Property insurance coverage must equal the lesser of the replacement cost or loan amount
Liability insurance coverage of $1M
Insurance issuer must meet the ratings criteria set forth in the Fannie Mae guidelines
Lender must be listed as mortgagee, loss payee, loss payable, and additional insured
Coverage must include fire and extended perils, and other hazards customary to the area
Flood insurance required for FEMA-designated special flood hazard areas
Earthquake coverage required in high-risk zones and/or as recommended in a property condition report
Hail and wind coverage may be required

Information in this summary reflects current requirements and may be modified or supplemented at any time, and from time to time without notice, at the discretion of Private Leverage.

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