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FREQUENTLY ASKED QUESTIONS
Updated August 25, 2010

What exactly does WN Funding actually do?
We really are a niche lender. We can do rehab loans, bridge loans, blanket loans, super jumbo loans, and many other types of investor loans (both residential and commercial) but our niche is doing low-LTV hard to place commercial deals. We lend hard money to real estate investors who need fast funding for properties and situations that traditional banks and lenders won't fund primarily based on the equity of the property. If you have a shaky credit history profile or hard to prove income or a unique type of loan that traditional banks are not interested in, then we can fund it.

How do I get started?
You can now apply online and get started right away.

Will you lend based on the appraisal if it is higher 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.

Do you lend on Owner-Occupant properties?
No, we do not.

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 to put money down?
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 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. We try our best to use common sense.

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.

Do you provide Pre-Approvals?
We have recently eliminated our pre-approval process and we no longer offer pre-approval letters because they have often been abused by potential borrowers.

Where do you lend?
Our rehab loans are only in the Philadelphia Metro area and surrounding areas but our bridge loans are nationwide with the exception of a few states. However, even within states where we do lend our lending parameters may vary to-and-from specific local markets.

Do you lend outside of the USA?
We have in the past looked at international projects but we are no longer looking at anything outside the United States. We also have discontinued lending in Puerto Rico and the US Virgin Islands.

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.

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.

Do you have a minimum or maximum loan amount?
Yes! $25k to $10million... but this varies significantly depending on the specifics of your deal as well as the state and local laws of your state and county.

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-$800 for residential properties and $1500-$5500 for commercial properties. BPO's range from $100-$1000 depending on what part of the country you live in. 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!

What factors on the appraisal could affect my approved loan amount and/or terms?
If there is a lack of MLS-sourced comparables on the appraisal, then that could effect whether or not Wooden Nickel Funding can offer you a loan. Additionally, if the main comps are not within one half mile of the subject property and/or were not sold less than 6 months ago may necessitate a lower LTV and/or a higher down payment. The appraisers are asked to stay within a “neighborhood” for comps and so comps are expected to not cross major roadways from the subject property. All factors on the appraisal are taken into consideration when making the decision on exact terms offered.

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.

How much will my monthly interest payments be?
Monthly payments are calculated on a per annum basis. To figure out your monthly payment multiply the rate by the loan amount and divide it by 12. The payment for a $100,000 loan at 18% would be $1500 (100,000 x 18% divided by 12 = $1500).

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.

Are loans available for rural property?
YES but if the property is located in a county with a population of less then 250,000 then the borrower will be subject to a full evaluation based on the merits of his/her credit. Also a larger down payment would probably 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.

Are extensions granted?
This greatly varies deal by deal. We will very rarely offer extensions on bridge loans but occasionally on rehab loans. A one time 6-month extension may be granted at the sole discretion of the lender on a case-by-case basis. Our portfolio status, the loan payment history, and property inspections will play a factor. An extension will have a fee attached often 2 - 6 points depending of the size of the loan. The lender reserves the right to request updated borrower information (including, but not limited to, credit score, tax returns, and bank statements) if the borrower information on file is over six months old.

What if I wish to purchase a property that contains mold?
If the inspectors or appraisers identify and report that mold is present in the property, it is required that the borrower conduct a mold inspection test using a certified specialist. The borrower is then required to present the test results/report for further review. The results will be taken into consideration in determining the terms of the loan offered. It will be the borrower’s responsibility to pay for these reports. Applications for properties with extensive mold repairs or that contain harmful mold may be declined.

What if I wish to purchase a property that has been previously damaged by fire?
These are reviewed on a case-by-case basis. We will require for you to provide a structural engineer’s report that identifies the scope of needed repairs. In the event that the loan is approved, a follow-up report from a structural engineer will be required before repair money is released for the required repairs. It will be the borrower’s responsibility to pay for these reports.

Do you finance properties that are involved in assignments or flips?
YES! Our loans certainly allow for these transactions, but we have limitations on the number of assignments or flips per transaction and we will limit the dollar amount allowed per transaction. Please contact our office for additional details.

WE WELCOME YOU TO APPLY ONLINE TODAY!!!

For more info on Hard Money Lending or Real Estate Investing check out our articles in the Real Estate 101 section.