Frequently Asked Questions
Find clear answers about investment property financing, borrower qualifications, available loan programs, documentation, and the lending process.
Frequently Asked Questions
Learn more about investment-property financing, borrower qualifications, loan programs, documentation, underwriting, and the role Borrowers Capital plays in helping investors evaluate potential financing options.
Borrowers Capital
Understanding our role and the types of financing requests we help evaluate.
Is Borrowers Capital a direct lender?
Borrowers Capital LLC operates as a correspondent lender and may also arrange financing through selected lending partners when another lending channel better fits the transaction. Through our correspondent channel, qualifying loans may be originated and closed in the name of Borrowers Capital and subsequently sold to an institutional lending partner. The structure used depends on the loan program, property, borrower qualifications, location, and transaction.
Who does Borrowers Capital work with?
We work with qualifying real estate investors, developers, business entities, and mortgage or loan professionals seeking business-purpose financing for non-owner-occupied investment properties.
What is business-purpose financing?
Business-purpose financing is used primarily for an investment, commercial, or business objective rather than personal household use. Examples include acquiring a rental property, renovating a property for resale, constructing an investment property, or refinancing an existing real estate investment.
Does submitting a deal guarantee financing?
No. A submission is a request for preliminary review only. Financing remains subject to lender guidelines, borrower and property eligibility, valuation, due diligence, underwriting, documentation, and final approval.
Programs and Properties
The most appropriate program depends on the property’s condition, financing purpose, and intended exit strategy.
What loan programs may be available?
Potential options include fix-and-flip financing, bridge loans, ground-up construction financing, DSCR rental loans, and multifamily financing. Availability and eligibility vary by lending partner, transaction, property type, market, and borrower qualifications.
What types of properties may qualify?
Depending on the program, eligible properties may include non-owner-occupied single-family homes, two-to-four-unit properties, townhomes, condominiums, multifamily properties, selected mixed-use properties, and residential construction projects.
Do you finance primary residences?
No. The programs presented through Borrowers Capital are intended for qualifying business-purpose, non-owner-occupied investment properties. They are not consumer mortgage programs for a borrower’s primary residence.
Can you help finance a property that needs renovation?
Yes. Fix-and-flip and selected bridge or multifamily programs may consider acquisition, refinancing, and eligible renovation costs. The scope of work, budget, property condition, experience, value, and proposed exit strategy will be reviewed.
Can land acquisition be included in a construction loan?
Land acquisition may be considered under selected ground-up construction programs. Eligibility depends on factors such as the purchase price, current land value, plans, permits, construction budget, completed value, borrower experience, liquidity, and project feasibility.
Can I refinance an investment property and take cash out?
Eligible cash-out refinancing may be available through selected bridge, DSCR, fix-and-flip, or multifamily programs. Maximum proceeds and any ownership-seasoning requirements depend on lender guidelines and the complete transaction.
Do you offer financing nationwide?
Programs may be available in many United States markets, but not every lender operates in every state. Eligibility can also vary by property location, property type, loan amount, rural classification, and local market conditions. Submit the property address for a location-specific review.
Qualifications
Approval is based on the complete scenario rather than any single qualification.
Can a first-time real estate investor qualify?
New investors may qualify under selected programs. Limited experience can affect leverage, pricing, required liquidity, project scope, and whether a guarantor, partner, or experienced contractor is needed.
What credit score is required?
Minimum credit requirements vary by program and lending partner. Credit is generally reviewed together with property value, leverage, liquidity, experience, loan purpose, payment history, and the proposed exit strategy. A credit estimate can be provided during the initial review.
How much liquidity will I need?
Liquidity requirements depend on the down payment or equity requirement, closing costs, lender fees, required reserves, renovation or construction exposure, and the size and complexity of the project. Proof of available funds is commonly requested during underwriting.
Do I need to borrow through an LLC or other entity?
Many business-purpose programs require the borrower to close in an eligible business entity, such as an LLC or corporation. Entity and guarantor requirements vary by lender and state. Do not create or modify an entity solely for a loan without obtaining appropriate legal and tax guidance.
How is investor experience evaluated?
Experience may be evaluated using previously purchased, renovated, constructed, sold, refinanced, or managed investment properties. Lenders may request a completed-project schedule, closing statements, settlement statements, or other evidence of ownership and completion.
Can foreign nationals qualify?
Foreign-national financing may be available under selected programs. Requirements can differ regarding identification, entity structure, United States bank accounts, reserves, credit documentation, and personal guarantees.
Rates, Fees and Leverage
Exact terms cannot be determined until the property and borrower profile have been reviewed.
What interest rate should I expect?
Rates vary by program, market conditions, lender, credit profile, experience, property type, leverage, loan size, transaction type, and other risk factors. Submit the complete scenario to receive a more relevant preliminary assessment.
What fees may be charged?
Depending on the transaction, costs may include lender origination, brokerage, underwriting, processing, valuation, inspection, draw, legal, title, closing, recording, and third-party fees. Applicable costs should be disclosed in the lender’s term sheet and loan documents.
Is 100% financing available?
Selected programs may finance up to 100% of eligible purchase and renovation costs when the transaction remains within the lender’s maximum leverage based on property value or after-repair value. This does not necessarily mean no cash is required.
Borrowers may still need funds for closing costs, fees, reserves, deposits, prepaid expenses, ineligible project costs, or the difference between the requested financing and the approved loan amount.
What do LTC, LTV and ARV mean?
- LTC — Loan-to-Cost: the loan amount compared with eligible acquisition and project costs.
- LTV — Loan-to-Value: the loan amount compared with the property’s current or completed value.
- ARV — After-Repair Value: the estimated property value after the proposed renovation is completed.
Are interest-only payments available?
Interest-only payment structures may be available under selected short-term and long-term programs. Payment structure, amortization, maturity, and any balloon payment will depend on the final loan terms.
Are there prepayment penalties?
Some programs may include a minimum interest requirement, exit fee, or prepayment penalty, while others may allow repayment without one. Review the term sheet and final loan documents carefully before closing.
Process and Documents
Begin with the essential transaction details. More documentation is requested if the scenario moves forward.
What information is needed for an initial review?
Start with the property address, financing purpose, purchase price or current value, requested loan amount, renovation or construction budget, estimated completed value, borrower credit estimate, liquidity, experience, exit strategy, and desired closing date.
What documents may be required during underwriting?
Requirements vary, but commonly requested items may include:
- Government-issued identification
- Purchase contract or existing mortgage statement
- Entity formation and governing documents
- Bank statements or other proof of funds
- Renovation scope of work and budget
- Construction plans, permits, and contractor information
- Leases, rent roll, and property operating information
- Real estate experience or completed-project history
- Insurance, title, appraisal, and closing information
How quickly can a loan close?
Closing time depends on the program, lender, appraisal or valuation, title work, property condition, required documentation, borrower responsiveness, and transaction complexity. A requested closing date should be provided immediately, but no closing date is guaranteed until underwriting and closing requirements are satisfied.
Will an appraisal be required?
Most programs require an appraisal, broker price opinion, automated valuation, property inspection, feasibility review, or another lender-approved valuation method. The required format depends on the lender, property, program, and transaction.
When are renovation or construction funds released?
Renovation and construction funds are commonly held in a controlled account and released through draws after eligible work is completed and verified. Draw procedures, inspections, retainage, deposits, and borrower-funded requirements vary by lending partner.
Should I upload sensitive documents with the initial inquiry?
No. Submit the basic financing scenario first. Do not send Social Security numbers, unredacted bank-account information, passwords, or other highly sensitive information through a general website form or ordinary email. Secure document-delivery instructions can be provided if the transaction advances.
Brokers and Referrals
Loan professionals may submit transactions for preliminary program review.
Can a broker or loan originator submit a deal?
Yes. The Submit a Deal form allows brokers and loan professionals to identify their role and provide borrower, property, transaction, brokerage, and requested-compensation information.
Can broker compensation be included?
Requested broker compensation can be provided with the submission. Whether compensation is permitted, included, disclosed, or paid depends on the lender, transaction, applicable law, licensing requirements, and final loan structure.
Will my borrower information be protected?
Borrower and transaction information should be used to evaluate, process, and potentially place the financing request in accordance with applicable policies and requirements. Brokers should submit only information they are authorized to share.
What makes a broker submission easier to review?
A complete submission should clearly explain the financing purpose, property condition, requested leverage, borrower qualifications, project budget, relevant experience, timing, and exit strategy. Identify unusual circumstances at the beginning instead of waiting for underwriting to uncover them.
Know What Information May Be Requested
Review the common information and documents used to evaluate investment-property financing before beginning the process.
Still Have Questions About a Specific Property?
Submit the property, requested financing, borrower profile, and investment strategy so the complete scenario can be reviewed.
Borrowers Capital LLC provides business-purpose real estate financing through correspondent and brokerage lending channels. Depending on the transaction, a loan may be originated by Borrowers Capital or arranged through a third-party lending partner. Program availability, rates, terms, fees, leverage, loan amounts, closing times, and approvals are subject to applicable lender or investor guidelines, borrower qualifications, property eligibility, due diligence, underwriting, and final approval. This information does not constitute a commitment to lend or an offer of credit.