What are Hanover MC’s underwriting requirements?

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What are Hanover MC’s underwriting requirements?

We start with looking at your qualifications. We seek to partner with professional redevelopers who have a track record of success. You should have 3+ projects under your belt and a network of contractors, legal professionals and real estate agents who help you achieve your goals. Once you are prequalified we look at each project on a case-by-case basis. Each project is different but in general here is what we are looking for:

  1. How much of your own equity is in the project? We required you to invest at least 20% of the purchase price into each project.
  2. Loan to Value should be less than 65% of the After Repair Value (ARV) of the property.
  3. ARV should be supported by a thorough analysis of sales data from comparable properties. This should be further supported by an appraisal and/or Broker Price Opinion (BPO). We will likely order our own BPO and appraisal to verify your analysis.
  4. You should supply us with a detailed statement of work with line item costs of all the repairs you plan to make. This should be supplemented with a home inspection report which we may confirm with our own inspection.
  5. You should outline your exit strategy. Do you plan to sell this to an owner occupier or an investor who will rent it out? Maybe you plan on refinancing the property with a traditional mortgage and holding it as a rental. Let us know as this can impact the market risk of the project.
  6. Send us pictures of the property which show its current state and key areas of the home that you plan on improving.

More is better when it comes to how much information you share. We make it easy on you by allowing you to submit all relevant information on our platform.

By |2017-03-11T16:04:18+00:00March 11th, 2017|0 Comments

About the Author:

G. David Lapin is the president and Broker of Record of HanoverMC, a private money lending and trust deed investment firm located in Orange County, California and is an author and speaker on the topic of private money lending and trust deed investing. Lapin was most recently featured in Robert Irwin’s book “Armchair Real Estate Investor” and hosted his own radio show “The Hard Money Hour”. Lapin's professional career in real estate encompasses 30 years of entrepreneurial experience in both the commercial and residential sectors, bridging property management, development, construction, investment sales and finance including residential mortgage banking and brokerage - originating, processing and closing 5,000 + purchase & refinance transactions, and the underwriting and funding of private money transactions.

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