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FREQUENTLY ASKED QUESTIONS
Updated May 20, 2011

Who is WN Funding and what exactly does WN Funding do?
Wooden Nickel Funding is a full spectrum asset based lending group. We consider ourselves a niche lender. We fund deals with private money and private credit lines for developers, investors, importers, rehabbers, landlords, and traders. We can do rehab loans, bridge loans, blanket loans, multi-family real estate loans, super jumbo loans, project financing, joint-venture projects, funding against financial & bank instruments, and many other types of investor loans (both residential and commercial real estate). We lend hard money to real estate investors and businesses who need fast funding for properties, projects, and situations that traditional banks or lenders won't fund. Our loans are primarily based on hard equity. We can also purchase cash flow notes such as mortgage notes, trust deed mortgages, private money mortgages, business-sale notes, all structured settlements, and a variety of annuities. We also lease financial instruments too. We do not loan any money against agricultural properties and we do not loan against residential owner-occupied properties. No exceptions. We seek to be flexible and creative, so please feel free to contact us to discuss your situation.

Do you have minimum or maximum amounts for your loans?
Yes! For our real estate loans we lend between $30k and $3million, but this may vary depending on the specifics of your transaction and the location of your property. For our SBLC loans we will lend from $1million to $100million.

Do you have minimum or maximum amounts for your Note Buying?
Yes! We will buy notes from $50k to $400k, but this varies significantly depending on the specifics of your transaction. For more info on our Note Buying process, click here.

What type of real estate will you lend against?
Non-owner occupied Residential properties, Multi-family units, Commercial, Mixed-use, Retail, Office, Industrial, Storage units, Gas Stations, Raw land (improved or unimproved), and all sorts of unique properties. We will consider any property in any condition that has income potential. However, we will not lend on residential owner-occupied properties or on agricultural properties whatsoever. Click here for more info.

Where is your lending area?
We will lend on real properties in or around metro areas nationwide in all states except Alaska, Hawaii, Louisiana, Vermont, and Washington, D.C. We prefer to shy away from rural properties unless it is a larger land loan in a growing area. While we will consider properties in most locations, our preferred markets are the Philadelphia metro area (including Southern NJ and selected parts of DE and MD) as well as the greater Houston market. In addition, we will also consider loans in metro areas of Canada on a very limited case-by-case basis.

What type of non-real estate collateral are you willing to lend against?
Stand-by Letters of Credit, Bank Guarantees (outside USA), Letters of Guarantee, Certificates of Deposit, Medium Term Notes, Documentary Letters of Credit, Insurance policies, Senior-Life Settlements, Bonds, Cash-flow Notes, and other liquid banking instrument or bank undertaking. For more information simply click here.

Do I need to put money down for a Hard Money Loan?
It truly depends on the deal and program but each borrower should be prepared to put down some initial investment. It truly varies case-by-case.

Do I need an appraisal? How much does it cost? Who pays for it?
In most cases, yes you need an appraisal or a BPO. Appraisals cost $350 to $800 for residential properties and $1500 to $5500 for commercial properties. BPO's range from $100 to $500 depending on what part of the country you live in and the type of real estate. You will need to pay for the appraisal or BPO before closing.

Can I choose my own appraiser?
No, we choose the appraisers. This is NOT negotiable!

Will you lend hard money based on the appraisal of a property if the appraised value is greater than the purchase price?
Maybe... we know that is sort of a "cop-out" answer but it truly depends on the specifics of your deal and the market you are in. We will base our LTV's on whatever we believe the true fair market value of the property is. If we truly believe the value is greater than the purchase price, then yes. Typically, in a "downward" or "declining" market it is very difficult to justify an appraisal higher than the purchase price but we recognize that in some rare instances it does occur. In those situations we will be as flexible as we possibly can be.

Will you do 2nd mortgages?
We will no loner consider second mortgages.

What are the requirements to borrow money from WN Funding?
Each borrower must demonstrate a viable exit strategy to satisfy the loan we are making and he/she must demonstrate the ability to manage the project at-hand. Each property must have clean title at the exact time of closing and must have title insurance issued by a title company/provider of our choice. All loans must have a personal guarantee attached. Any property we choose to lend on must have strong recent comparable sales. Borrowers may not have any unpaid IRS liens or state tax liens at the time of closing. Borrower (or guarantor) must not have had a bankruptcy or foreclosure in the last 5 years. Also, the borrower must not have had any late mortgage payments in the last 5 years, must not have any outstanding unpaid child support or alimony, must not have any unresolved mechanical liens, and must not have any outstanding unresolved judgments whatsoever.

Do you allow interest payments to be deferred? Must I make payments?
It truly depends on the specs of the project and the city the property is located in. This is done far more frequently on large commercial projects than on residential properties. We can work a payment-reserve account into the deal but if this is not done prior to closing this will not be available after closing.

Do I need good credit to borrow hard money?
We are NOT a FICO-driven lender but your overall background will affect the terms and conditions on any loan we can offer. You must show a viable exit strategy before we'll loan you any money, and many times credit may affect your ability to present us with a viable strategy to pay back the loan. We try our best to use common sense in all our deals.

Can I borrow 100%? In other words, will you finance the purchase price, the closing costs, the loan fees and the rehab costs?
YES!..... but...... we need to be very comfortable with you the borrower and the deal. We will lend you all the up-front money for your deals once you have proven yourself reliable. If the deal is done right, then yes you can borrow EVERYTHING. Once we have established a working relationship the loan process will get faster and easier.

What is considered residential property?
A residential property is any property (1-4 units) that is fully zoned for residential usage only. Any property with commercial zoning or mixed-use zoning is considered commercial. Also, any property that has 5+ units, regardless of zoning, is defined as commercial.

Do you lend "blanket mortgages" to cover multiple properties?
Yes, on a very limited case-by-case basis.

If I convert my Note to cash, will it affect the person paying me?
Nope. All the terms and conditions of the note/mortgage stay the same. The person making payments on the note will see no change whatsoever.

How long does it take to close a hard money loan?
We have closed loans as fast as 72 hours but it usually takes up to 2 weeks to close a loan. We are very quick and once we have all the needed docs we can fund your loan. Typically loans get held up because of title searches, appraisals, or problems with the seller. These are all things we have very little control over.

How long does the Note Buying process take?
The whole process from start to finish, usually takes 1-3 weeks. Title insurance is required on each transaction and we will find a local real estate broker to provide us with a BPO or "drive by" appraisal, as needed. Some areas of the country are quicker than others.

I have heard that some Note Buyers do "full buyouts" and others may do a "partial buyout." What is the difference? Which do you do?
A full buyout of your note means that you are selling the entire note. A partial buyout means that you are just selling a certain number of payments. For example, let's assume you have a note that has 27 years of remaining payments left on it. One example of a partial buyout is for you to sell the next 5 years of monthly payments to us. You would receive a lump sum of cash now. We would receive the next 5 years of monthly payments before the note reverts back to you. You would then start receiving payments again for the remaining 22 years.

Do you require inspections?
Appraisals and/or site inspections are often required but it truly depends on the local industry norms in your market. These inspections may or may not be needed on bridge loans or jumbo loans depending on the specs of the deal.

Do you require a survey?
For ordinary properties surveys are not generally require however we rarely will make a loan on a raw land deal without a full survey report. Also, if the local title company or closing attorney cannot secure proper title insurance on an ordinary property without a survey (for some odd reason it occasionally happens) it will also be required.

Do I need flood insurance? Can the property be in a flood zone?
We do not ordinarily need flood insurance but if the title needs it in your specific local market to issue title insurance then yes you will need it. If the property is in a flood zone than the borrower will need to provide federal flood insurance. Wooden Nickel Funding reserves the right to decline any loan submitted for any property in a flood zone.