How to Package a Loan Request for Construction, Rehab, and Commercial Loans

 SFR Ventures Inc. requires that a Financing Request
Package accompany all loan requests.
 This template focuses primarily on residential rehab,
construction, and development loans and provides a
consistent process for borrowers to streamline the financing
process and accelerate the funding timeline to meet the
closing deadlines.
 Timely submission of a completed Financing Request
Package can mean funding in as little as 5–7 business days.
Summary

 We aim to review and respond to loan requests within 48
hours of receiving the Financing Request Package
 Criteria for a loan request to be considered:
 Borrower must have real estate experience with a proven track
record
 Borrower is required to have a minimum of 20% equity into the
deal
 The loan-to-value (LTV) may not exceed 70%
Summary

 SFR Ventures Inc. seeks to establish long-term relationships
with experienced real estate investors, owner operators,
developers, and brokers that are built upon trust, client
service, and executional efficiency.
 Submit your Financing Request Package or any specific
questions related to your particular transaction to
beau@sfrventures.com
About SFR Ventures Inc.

I. COVER PAGE
II. EXECUTIVE SUMMARY
III. PROPERTY DESCRIPTION
IV. LOCATION & MARKET ANALYSIS
V. FINANCIAL ANALYSIS
VI. ABOUT BORROWER
VII. APPENDICES

 The Financing Request Package should include a Cover Page
with the following information:
 Picture of the Property
 Full Property Address
 Timing for Funding (Closing Date, etc.)
 Borrower(s) Complete Contact Information, which should include:
 Name of Company (or entity that will own the investment)
 Name of Owners & Principals involved in the transaction
 Business Address
 Phone Numbers of Related Parties
 Email Address
 Website Information
I. COVER PAGE

 is a brief narrative of the financing request, which
summarizes the transaction, including the property and
loan specifics
 should be clear and concise, and gives the borrower the
ability to sell the deal to the lender.

The Executive Summary should include the following information for the
lender’s review:
1. Brief description/background on the deal
 How did you source the opportunity?
 What is the purchase price and timing of the transaction?
 Why are you utilizing private money?

2. Purpose of the Loan Request
 Purchase, Refinance, Bridge, Construction, Development, etc.
3. Exit Strategy
 What is your exit strategy and timing? How do you plan on
repaying the loan?
 Sale, Refinance
 Briefly justify your exit strategy

4. Loan Proposal Request (Summarize loan terms you are
requesting)
 Closing Date / Timeframe
 Loan Amount
 Amount of Borrower Equity
 Term of Loan
 Interest Rate
 Any additional loan specifics

5. Sources & Uses of Funds (see Appendices section for
examples)
 Sources – where capital is coming from on the deal
 Uses – how the capital is being utilized in the deal
 Sources of Funds must equal Uses of Funds
6. Brief summary of Borrower and/or Company
 Quick write-up for lender to identify borrower and/or company

 should provide a complete physical description of the land,
improvements, and the property, as well as any additional visual aids,
such as photos, site plans, etc.
 For development and construction financing, the borrower should
include a detailed scope of work, broken out line by line, regarding
the proposed improvements to the property and associates costs
with those improvements.

1. Property Information
 Property Name and/or Physical Address
 Property Type (single-family, 1-4 unit, apartment, retail, mixed-used,
office, etc.)
 Number of Units & Net Rentable Square Feet
• Breakdown of units and sizes
 Year Built/Renovated/Remodeled

2. Site/Land Details
 Purchase Price
 Total acreage or SF
 Zoning
 Ingress and egress
 Utilities
 Easements or deed restrictions
 Roads / shared driveways
 Excess land

3. Construction Details
 Configuration, design features/utility
 Type of roof, foundation, mechanical/electrical systems, heating/hvac
systems
 Public Utilities
 Parking
 Deferred Maintenance

4. Proposed Scope of Construction / Improvements
 Detailed line-item list of all proposed improvements and associated
costs
 Construction Schedule
 A construction budget/draw schedule spreadsheet template is
available

 should educate the lender on the property’s particular
location/neighborhood, as well as the general market
information and economic drivers for the particular
area/city
 should include comparables (active and sold) that justify
and strengthen the exit strategy proposed.

The Location & Market Analysis section should generally include the following:
 Brief write-up on the property’s location as well as the local market
information
 Justify why good area/market for your investment
 Demographic Information (pull from US Census or local city authorities)
 Additional Facts & Figures
 Pricing trends, valuations, Zillow, Trulia, etc.
 Map showing subject property and location of relevant comparables

 Borrower should also provide a one-page summary of the
comparables, preferably in excel, justifying the market value. The
specifics of the comps will vary based upon the type of property,
but the analysis should provide the lender with simple layout
justifying the exit strategy and valuation.
 Summary of comparables should include the following:
 Criteria used for comparable analysis
 4 Active/UAG Comps
 4 Sold Comps
 4 Rental Comps

 The lender will want to be able to easily compare the following
information from this summary:
 Purchase Price Analysis
 PSF, Per Unit, Per Acre, Cap Rate, etc.
 Verify true comparable to the subject property
 Size, type, # bedrooms, # baths, land size, # units
 Market Timing
 How long on the market? Sale Price to List Price?

 The lender is looking to review the assumptions made by the
borrower when conducting their analysis, as well as any
additional financial documentation that can be provided
to prove out the analysis.

The Financial Analysis should include the following information for the lender to review:
 Detailed Financial Analysis Pro-Forma
 Detail assumptions made about analysis
 Loan Terms, Cost Breakdown, Residual Valuation
 Include particular model or excel spreadsheet utilized
 Flip Model
 Monthly Cash Flow Analysis
 Development/Construction Model
 Net Profit Analysis
 Rental Pro-Forma (for refinance exit)
 Shows sufficient debt coverage
 IRR Analysis

 This section should is a brief description of the company and the
associated borrower(s), manager(s), or principal(s). The borrowing
entity that is purchasing the property should also be included in the
section. The lender is looking for company history and track record, as
well the backgrounds of the individuals in the transaction.
 The general format should be as follows:
 Description of the Company
 Track Record
 List of current/historical real estate transactions
 Resume of owners, principals, etc.
 Can be included in the Appendices, if applicable
VI. ABOUT BORROWER

 The borrower should provide all relevant additional
documentation related to the particular transaction. The
lender will typically request this additional information after
initial review, but always good to already have the
information ready for the lender to review in order to
expedite the underwriting process.
VII. APPENDICES

 The typical items that the borrower should make available to the lender for
review (if applicable) are as follows:
VII. APPENDICES
 Property Information
 Listing Sheet
 Purchase & Sale Agreement
 Copy of Deed
 Appraisal (if applicable)
 Pictures of the property (interior &
exterior)
 Tax Assessor Card
 Photos of the property and site
(interior and exterior)
 Site plan, survey, or recorded plat
 Floor plans
 Aerial photographs
 Construction Budget & Timeline
 Plot plans, permits, approvals,
conceptuals, floorplans,
sketches, zoning, elevations
 3rd Party Reports
 PCR, Environmental,
Zoning
 Sources and Uses of Funds
(example below)

VII. APPENDICES
PURCHASE (EXAMPLE)
Sources of Funds Amount %
1st Lien Mortgage $800,000 80.0%
2nd Lien Mortgage (Seller/Private) $0 0.0%
Equity (Borrower's Cash) $200,000 20.0%
TOTAL SOURCES $1,000,000 100.0%
Uses of Funds Amount %
Purchase Price $650,000 65.0%
Closing Costs $30,000 3.0%
Hard Costs $200,000 20.0%
Financing $100,000 10.0%
Soft Costs (Carry Costs) $20,000 2.0%
TOTAL USES $1,000,000 100.0%
REFINANCE (EXAMPLE)
1st Lien Mortgage $1,000,000 100.0%
TOTAL SOURCES $1,000,000 100.0%
Payoff Existing Loan $600,000 60.0%
Renovations / Rehab Costs $250,000 25.0%
Buy Out Partner $100,000 10.0%
Mortgage Broker Fee $10,000 1.0%
Lender Fee $10,000 1.0%
Appraisal, Phase I, Structural $10,000 1.0%
1st Lien Mortgage $800,000 80.0%
2nd Lien Mortgage (Seller/Private) $0 0.0%
Equity (Borrower's Cash) $200,000 20.0%
TOTAL SOURCES $1,000,000 100.0%
Purchase Price $650,000 65.0%
Closing Costs $30,000 3.0%
Hard Costs $200,000 20.0%
Financing $100,000 10.0%
Soft Costs (Carry Costs) $20,000 2.0%
TOTAL USES $1,000,000 100.0%
REFINANCE (EXAMPLE)
1st Lien Mortgage $1,000,000 100.0%
TOTAL SOURCES $1,000,000 100.0%
Payoff Existing Loan $600,000 60.0%
Renovations / Rehab Costs $250,000 25.0%
Buy Out Partner $100,000 10.0%
Mortgage Broker Fee $10,000 1.0%
Lender Fee $10,000 1.0%
Appraisal, Phase I, Structural $10,000 1.0%
Refinancing Costs $5,000 0.5%
Legal Fees $5,000 0.5%
Title, Survey, & Escrows $10,000 1.0%
Earn-out $0 0.0%
TOTAL USES $1,000,000 100.0%
The borrower should also have the following personal financial information available if requested by the
lender for further review:
 Personal Financial Statements
 2 years of Tax Returns
 List of Real-Estate Owned Properties (REO Schedule)
 Bank Statements
 Credit Report

How to Package a Loan Request for Construction, Rehab, and Commercial Loans

How to Package a Loan Request for Construction, Rehab, and Commercial Loans

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