Will an open line of credit from Dominion appear on my credit report?
No. Under normal circumstances, we do not report to credit agencies. We report to agencies only if we are forced to place a judgment or collection on you or your company for lack of payment on your hard money loan.
Will you lend on a house that is my primary residence?
No. Hard money loans are commercial loans, which means they are business to business. We, by law, cannot lend on personal, homeowner occupied properties.
Is there a prepayment penalty associated with the loan?
No. You can repay the hard money loan prior to its maturity date with absolutely no additional fee for prepayment.
I have a HELOC – shouldn’t I just use that?
There are many ways to fund a deal – and every method has its tradeoffs. Funding a deal with a HELOC from another property is a great way to fund deals.
The downside is, real estate investing comes with some level of risk. If for whatever reason the deal sours, your primary residence could be on the line if you fail to make the payments. Let’s suppose that things don’t get quite that bad – at the very least, your good credit could be on the line if you fail to pay the HELOC payments on time.
Finally, let’s assume that you have a $100,000 line of credit on your personal residence. If you max out that line for the purposes of funding a deal – you can be assured that will have a very negative effect (all be it temporary) on your credit score. When the balance on a line of credit goes over 50% of the limit, your FICO score goes down.
What documents do I need to get started?
We make it super-simple to get approved for a Dominion Investor Line of Credit. You’ll need 2 years of tax returns, a recent bank statement showing capital, and a completed personal financial statement.
If you are pre-qualified, we’ll also pull a credit report. From there, you could be approved for the Dominion Investor Line of Credit™ within 48 hours.
How much money do I have to put in the deal?
We’ll lend 90% of the purchase price and 100% of the rehab.
This is much more than most HML’s will lend, but it’s not quite 100%.
You’ll need to bring 10%, plus your closing costs, plus origination fees to the table. Closing costs vary across the county, so check with your local investor friendly title attorney for typical closing fee
Where does Dominion Financial Services Lend?
We are a hard money lender currently lending in every state in the U.S. with the exception of California, Utah, Nevada, Vermont, Maine, Arizona, Arkansas, Idaho, Montana, North and South Dakota, Iowa, Mississippi, Minnesota, Oregon, Alaska, Hawaii, Oklahoma and Minnesota.
Do you allow secondary financing or seller-held notes?
Generally yes. We are not concerned the source of your down payment for the deal, so long as your credit, current income, and bank statements illustrate your ability to pay back the loan.
Do you check the title? Are there title feels?
As a matter of standard operating procedure, all lenders require a clear marketable title prior to loan approval. This protects our investment and it also protects you. Contact your local investor friendly title company or title attorney. They should be able to provide you with a list of fees that are associated with title.
Is there a limit to the number of deals or houses that I can buy?
No. You are only limited by the amount of the Investor Line of Credit for which we’ll approve you. That number can change as your income or financial situation changes.
How do I get a hard money loan?
We’ve outlined the entire process for loan approval.
Can I get a hard money loan if I have a low credit score?
Yes. Generally speaking, we are far more concerned with what is on the credit report than the credit score. We’ve worked with borrowers who had FICO scores as low as 600.
Here’s a general rule: if you’ve had a lien, judgement, bankruptcy, short sale or foreclosure in the last 24 months, we may unable to fund your deal through our hedge fund partner. We still however may be able to fund the deal through our house account. Just know however that you’ll pay more for this money, and you will have to provide a pretty solid explanation of your situation.
Will I have to submit personal financial statements?
Yes. We will need 2 years of tax returns, a bank statement showing your capital, and a personal financial statement.
Do you work with or compensate brokers?
We have not had particularly good luck working with brokers, but we are willing to try.
If you are the owner or leader of a Real Estate Investment Association (REIA), or Meet-up group, and you’d like to pitch our services to your members, we would gladly speak to you about compensating you for the referrals.
Is Dominion Financial Services a licensed lender?
No. Dominion Financial Services, is not a licensed mortgage lender. Our loans are commercial investment grade loans. There are currently no state or federal regulations (in the states where we’re lending) requiring licenses for commercial lenders.
What types of properties will you lend on?
We primarily lend on single-family attached and detached houses.
We also underwrite many loans for landlords as well – so feel free to bring us your single family and multi-family rentals. Remember, our loans are short term, 6 – 12 months. That means you’ll need to prove that you have a bank lined-up to re-fi our loan.
Are your loans fully amortizing?
No. Dominion Financial loans are “interest only” with a balloon payment at the end of the 6 – 12 month term. This is very typical for all hard money loans.
Do you lend purchase price or appraised value?
Dominion Financial lends based on the property’s value once you’ve completed the repairs. In other words, we lend based on the After Repair Value (ARV).
Can I roll the closing costs and origination points into the loan?
No. We believe in making the borrowing process as easy as possible. We are the most competitive lender in the country in terms of interest rate and points, but we also believe a borrower should have some amount of skin in the game.
What are “junk fees” and will I pay them with Dominion?
We do not believe in junk fees! So, no, you will not pay junk fees with a Dominion Financial loan. With Dominion Financial, there are no appraisal or BPO fees.
Lenders use junk fees to squeeze a little more out of each loan, and therefore out of your pocket. These fees are often hidden. In most cases, you don’t hear about junk-fees until you’re signing the HUD-1 at the closing table. Do not agree to pay these fees! Walk away from the loan!
Junk fees are often listed as, “loan admin, loan doc evaluation, appraisal, doc prep fee, commitment fee, lender fee, reconveyance verification fee, tax service fee, funding fee… etc.”
Will you extend the term of the loan if needed?
Yes. We understand that sometimes even the best of deals don’t go as planned. We do however have to pay for the money that we borrow. That said, we’re happy to extend the loan for 1 point per month. That’s 1% of the loan amount in addition to the existing payment.
My house is in foreclosure. Can I get a loan?
If the house is your personal residence, the answer is “No.” If the house is an investment property, the answer is also more than likely, “No,” unless you have a significant amount of equity in that property or another investment property.
We will, however, assist you with a short sale on the property.