Based in Baltimore, MD, PSG Lending is a hard money lender providing funding throughout Washington DC, Philadelphia, Arlington, and Alexandria. They provide loans for a variety of scenarios, including hard money loans for commercial properties, short term loans, short term fix and flip loans, construction loans, and private refinancing. Their lending parameters are versatile, including loan amounts ranging from $500,000 to $5,000,000 with a maximum LTV of 70%, rates ranging between 9% and 12%, and terms between 12 months and 18 months. They will make loans on numerous types of properties, including single family units, multi-family units, retail units, mixed use, senior housing facilities, storage buildings, industrial facilities, and raw land.
Below are the general loan guidelines published on the PSG Lending website. Please confirm all terms and rates directly with the lender.
The following loans are for education purposes only. They do not represent actual loans executed by PSG Lending.
PSG Lending makes a fix and flip loan to Nathaniel for a rehab project in Washington DC, DC, on a property that is listed for $350,000. The terms of the deal include a 85% loan-to-value (LTV), so he must bring 15% of the price as cash at closing, which makes the principle loan amount $297,500. The parameters of the deal dictate a 11% note for 12 months. They also require a 5 point origination fee, that will also be paid when the property closes.
In accordance with the terms of the deal, Nathaniel will have to pay a $14,875 origination fee in addition to 15% of the sales price, or $52,500, based on the 85% LTV. PSG Lending will collect $2,727 in monthly interest payments from the borrower. This is calculated by taking the full loan amount of $297,500, multiplying by the 11% rate of interest, and then dividing that amount by 12. Assuming Nathaniel sells the renovated project for $437,500 at the end of the 12 month term, his total profit (not including remodeling expenses) would be $39,900. This is calculated by taking the sales price ($437,500) and subtracting the original principle ($297,500), the origination fee ($14,875), the funds he brought to closing ($52,500), and the total interest payments ($32,725).
a) A $300,000 purchase price, b) a 60% loan to value (LTV), c) a 12 month term, d) a 11% interest rate, and e) a 3% origination fee.