Are all hard money lenders this bad?
Member since 2023 · 4 posts · 8 votes
Are all hard money lenders this bad?
Most Popular Reply
Robin SimonBusiness Member
Lender · Austin, TX · Member since 2022 · 5k+ posts · 4k+ votesQuote from @Ishmael Lopez:
Quote from @Chris Seveney:
Quote from @Ishmael Lopez:
Kiavi changed my appraisal 3 times and the last time was 5 weeks into it, I of course walked away. Lima one wasn’t transparent with their processes, and I just heard finance of America is getting pretty bad. Are these guys all just legal scammers? Or are there some good guys in this industry. If there are please feel free and share companies that you’ve had clear transparency and great communication. Thanks!! 🙏🏼
They are not scammers, there is reasons why things change.
Recommend going through Google and looking closely at the track records of reviews for each of these lenders. If there are "miles of bad reviews" for Kiavi, to be honest, some of that is on you for trying them? Stick to lenders with top ratings on google, biggerpockets, facebook etc. and you should be fine
Harpoon Capital515 Reviews
34 Replies
- Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes3y
Quote from @Ishmael Lopez:
Kiavi changed my appraisal 3 times and the last time was 5 weeks into it, I of course walked away. Lima one wasn’t transparent with their processes, and I just heard finance of America is getting pretty bad. Are these guys all just legal scammers? Or are there some good guys in this industry. If there are please feel free and share companies that you’ve had clear transparency and great communication. Thanks!! 🙏🏼
They are not scammers, there is reasons why things change.
7e investments53 Reviews - Member since 2023 · 4 posts · 8 votes3y
Quote from @Chris Seveney:
Quote from @Ishmael Lopez:
Kiavi changed my appraisal 3 times and the last time was 5 weeks into it, I of course walked away. Lima one wasn’t transparent with their processes, and I just heard finance of America is getting pretty bad. Are these guys all just legal scammers? Or are there some good guys in this industry. If there are please feel free and share companies that you’ve had clear transparency and great communication. Thanks!! 🙏🏼
They are not scammers, there is reasons why things change.
I def think some of them run a little “gray” And mislead. And I think there are some good transparent companies. Do you have any you could recommend?
- Member since 2023 · 4 posts · 8 votes3yIm not sure how to take your comment, I’m not sure if it was snarky as it was over text. But there are reasons why things change and sometimes that’s for scammy reasons. I’m not saying they are all bad. But there are miles of bad reviews for kiavi. I guess my hope of posting this was to find good ones. Not over simplified replies.
Quote from @Chris Seveney:
Quote from @Ishmael Lopez:
Kiavi changed my appraisal 3 times and the last time was 5 weeks into it, I of course walked away. Lima one wasn’t transparent with their processes, and I just heard finance of America is getting pretty bad. Are these guys all just legal scammers? Or are there some good guys in this industry. If there are please feel free and share companies that you’ve had clear transparency and great communication. Thanks!! 🙏🏼
They are not scammers, there is reasons why things change.
- Member since 2023 · 2 posts · 0 votes3y
Quote from @Ishmael Lopez:
Kiavi changed my appraisal 3 times and the last time was 5 weeks into it, I of course walked away. Lima one wasn’t transparent with their processes, and I just heard finance of America is getting pretty bad. Are these guys all just legal scammers? Or are there some good guys in this industry. If there are please feel free and share companies that you’ve had clear transparency and great communication. Thanks!! 🙏🏼
I've heard tons of bad things about Kiavi, so sorry about your experience. And yes!! 100% agree a lot of these companies can be pretty shady. They aren't techincally illegal, but they will def bait and switch you last minute, and pretty do whatever they can that's "legal". Luckily, there are some good apples in the pond. I used one from the recommend section here, and worked out good. But I also do hear a lot of horror stories too. GL! :D
- Member since 2023 · 2 posts · 0 votes3y
Quote from @Chris Seveney:
Quote from @Ishmael Lopez:
Kiavi changed my appraisal 3 times and the last time was 5 weeks into it, I of course walked away. Lima one wasn’t transparent with their processes, and I just heard finance of America is getting pretty bad. Are these guys all just legal scammers? Or are there some good guys in this industry. If there are please feel free and share companies that you’ve had clear transparency and great communication. Thanks!! 🙏🏼
They are not scammers, there is reasons why things change.
Maybe not scammers, but there are def some pretty predatory companies out there. Which is honestly a shame!! There are def reason why things change, but some are because companies are shady, and some are because markets change. But from my Hard money lenders, i don't think I ever had an official non hybrid appraisal ever change last minute. I'd honestly be pretty livid if it did.
- Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes3y
@Ishmael Lopez
It was not snarky but I would be careful calling companies scammers.
My recommendation and what we follow is if a company has a history of bad reviews we do not go to them or use them
We only will use a company that we have someone we personally know has used them. Not a this guy said they were good and then find out he heard them on a podcast and never used them.
Typically the lower the hard money rate the more difficult it will be to get financing and the more painful the process.
If you are willing to pay 5 points and 15 percent interest and put 20% down I have lenders who will fund in under 2 weeks.
7e investments53 Reviews - Member since 2023 · 4 posts · 8 votes3yWow!! Thank you! That’s a great reply! Appreciate! And yea I think I was a little frustrated, and was pleaing for help. Tbh Lima one was pretty professional, think it was just a miscommunication, I do have to get better at asking the “right” questions. 🙂🙂
Quote from @Chris Seveney:
@Ishmael Lopez
It was not snarky but I would be careful calling companies scammers.
My recommendation and what we follow is if a company has a history of bad reviews we do not go to them or use them
We only will use a company that we have someone we personally know has used them. Not a this guy said they were good and then find out he heard them on a podcast and never used them.
Typically the lower the hard money rate the more difficult it will be to get financing and the more painful the process.
If you are willing to pay 5 points and 15 percent interest and put 20% down I have lenders who will fund in under 2 weeks.
- 3yRobin SimonBusiness MemberLender · Austin, TX · Member since 2022 · 5k+ posts · 4k+ votes
Quote from @Ishmael Lopez:
Im not sure how to take your comment, I’m not sure if it was snarky as it was over text. But there are reasons why things change and sometimes that’s for scammy reasons. I’m not saying they are all bad. But there are miles of bad reviews for kiavi. I guess my hope of posting this was to find good ones. Not over simplified replies.Quote from @Chris Seveney:
Quote from @Ishmael Lopez:
Kiavi changed my appraisal 3 times and the last time was 5 weeks into it, I of course walked away. Lima one wasn’t transparent with their processes, and I just heard finance of America is getting pretty bad. Are these guys all just legal scammers? Or are there some good guys in this industry. If there are please feel free and share companies that you’ve had clear transparency and great communication. Thanks!! 🙏🏼
They are not scammers, there is reasons why things change.
Recommend going through Google and looking closely at the track records of reviews for each of these lenders. If there are "miles of bad reviews" for Kiavi, to be honest, some of that is on you for trying them? Stick to lenders with top ratings on google, biggerpockets, facebook etc. and you should be fine
Harpoon Capital515 Reviews - Contractor · Nashville, TN · Member since 2014 · 1k+ posts · 1k+ votes3y
You have to use regional and local HMLs. Those are the good ones. The big names like Lima are junk. Every market will have quite a few local guys and companies that close quick.
- 3yDoug SmithPro MemberLender · Tampa, FL · Member since 2013 · 2k+ posts · 2k+ votes
I'm familiar with all three. We stopped brokering through Finance of America when they backed-out of a deal and cost me a very good customer. That being said, they recently were acquired by ROC Capital. Kiavi (formerly Lending Home) actually has been pretty good to work with in the past. I've gotten to know some of the Lima One folks at conventions. They are good people, but didn't find their programs to be that attractive for customers. We broker most of the DSCR and Flip deals we do. It keeps the capital flowing. I think the biggest challenge for borrowers is knowing how to stack the deal to make it flow through and where the pitfalls are. Most of the people in this type of lending come from one of two areas...real estate or investment banking (raising capital...Wall Street-types). Very few have formal credit/lending backgrounds, so sometimes they ask for things that make absolutely no sense. I had one lender that tried to poo-poo a deal and only would tell me that fraud showed up on my customer's file...but wouldn't tell me why. I finally got someone to tell me that he supposedly had several foreclosures showing up. I remember saying "wait a minute, are you sure you are reading the special warrant deeds right and you know the difference between 'grantor' and 'grantee'?'" My customer BUYS foreclosed property. It delayed the deal for about 10 days until I could get them to understand. Trust me...it frustrates me too.
There's a reason why the call it hard money I suppose and I tried to deal with a couple of these companies mentioned myself as an investor. I have had my clients ask me to recommend one and I haven't been able to find one that I like working with. Following to see what comes up.
5 points and 15% interest?? Brutal. The mafia would be proud of those terms. In Florida the max that is legal is 18%; points and interest. If you're actually paying that you're getting hosed.
Those institutional nationwide lenders do deals, but they back out a lot, and leave investors in a bad spot. Your best bet is to find a local lender through referrals. Getting pre approved is cool, actually closing on the property is way cooler.
- Lender · Member since 2022 · 138 posts · 20 votes3y
Quote from @Ray Hage:
There's a reason why the call it hard money I suppose and I tried to deal with a couple of these companies mentioned myself as an investor. I have had my clients ask me to recommend one and I haven't been able to find one that I like working with. Following to see what comes up.
I would welcome the chance to discuss some of your frustrations. We are a direct lender and have the ability to be as transparent as possible.
- Lender · Member since 2022 · 138 posts · 20 votes3y
Quote from @Ishmael Lopez:
Kiavi changed my appraisal 3 times and the last time was 5 weeks into it, I of course walked away. Lima one wasn’t transparent with their processes, and I just heard finance of America is getting pretty bad. Are these guys all just legal scammers? Or are there some good guys in this industry. If there are please feel free and share companies that you’ve had clear transparency and great communication. Thanks!! 🙏🏼
As a direct lender we are pretty transparent. Especially since this is a process driven industry. As far as cost your looking at rates of about 11%.5 to 12.5% with 20 percent down. However each situation is different therefore it is best to have an intelligent conversation based upon entry and exit strategy. Also experience plays a key component as well. I would say look for recent social proof. Try this old school thing called making a phone call and see how the energy is when they answer. You are not the client but a partner. A call is a great thing for the right teammate.
Quote from @Ishmael Lopez:
Kiavi changed my appraisal 3 times and the last time was 5 weeks into it, I of course walked away. Lima one wasn’t transparent with their processes, and I just heard finance of America is getting pretty bad. Are these guys all just legal scammers? Or are there some good guys in this industry. If there are please feel free and share companies that you’ve had clear transparency and great communication. Thanks!! 🙏🏼
@Ishmael Lopez Hard money lending is still tough to do well on a national scale in my opinion. It is just to many "what if's" and the ability to be flexible as every deal is different in the HML world it is tough to do it well when you are working with a tight box. Not executing particular well makes does make any of the names you mentioned above as "scammers". But, executing well is the point, so would likely be better off with local HML lenders in your market. (even if you end up paying a bit more)
Hurst Real Estate, INC4.986 Reviews- Lender · NJ · Member since 2022 · 129 posts · 18 votes3y
There are 3 types of lenders in this market: The lender that's still open, the lender that's restructuring (good luck closing on time), and the lender that is completely out of business...
- Lender · NJ · Member since 2022 · 129 posts · 18 votes3y
Quote from @Chris Seveney:
@Ishmael Lopez
It was not snarky but I would be careful calling companies scammers.
My recommendation and what we follow is if a company has a history of bad reviews we do not go to them or use them
We only will use a company that we have someone we personally know has used them. Not a this guy said they were good and then find out he heard them on a podcast and never used them.
Typically the lower the hard money rate the more difficult it will be to get financing and the more painful the process.
If you are willing to pay 5 points and 15 percent interest and put 20% down I have lenders who will fund in under 2 weeks.
This is interesting! 5 pts in origination fees? Or is that an estimated cost to close?
- Member since 2019 · 7k+ posts · 4k+ votes3y
Quote from @Dylan M. Davis:
There are 3 types of lenders in this market: The lender that's still open, the lender that's restructuring (good luck closing on time), and the lender that is completely out of business...
almost every big bank now has to sustain their opex becaue they have so much unrealized loss from the gov. action to increase rate LOL
I can't blame them though. - Specialist · NJ · Member since 2022 · 1k+ posts · 661 votes3y
Changing guidelines on the fly is something lenders are not scared to do at all. I've had to go back to borrowers several times and un-promise what I had promised them. Makes me look bad. I hate it.
Here's the problem with Kiavi appraisal process. They only order an inspection that provides no value, just a condition report of the house. They have an internal team of like a dozen appraisers that are supposed to research the zip code and get comps and assess a value based on either the DSCR or ARV. The problem is, these appraisers setting the values are not boots on the ground in the zip code and can in no possible way know the area as well as an appraiser who has worked in the area for decades. I had this battle with them before when they came in short on an appraisal of mine.
But you trade that for lots of other perks they offer:
only a soft credit pull that needs to be 660.
you have to show exactly 0 bank reserves (this is crazy, only lender out there who operates like this)
Not much in terms of documentation.
- Lender · Austin Texas · Member since 2022 · 319 posts · 156 votes3y
At the institutional level there are very few companies that do it well.
At the regional level you deal with companies that often times run out of money.
At the local level you deal with people who want to control and manage the project.
Like the above poster said - give and take - what some do well, others do poorly, and what is important to you as a borrower is ultimately who you should work with.
Hard Money companies are all fighting for market share through leverage and rate.
- Real Estate Broker · New York, NY · Member since 2020 · 2k+ posts · 1k+ votes3y
Hey @Ishmael Lopez - have you thought about just working with HML that are actually local to your area? That might be a good start to getting a better experience working with a private lender(s) that actually have a deeper understanding of your market.
- 3yJohn O'LearyPro MemberLender · Winter Park, FL · Member since 2021 · 738 posts · 412 votes
5 points and 15% is insane.
- Lender · Irvine, CA · Member since 2013 · 22 posts · 2 votes3y
All 3 companies listed here are legitimate funding sources, but the market is fluid and so are guidelines, Khiavi valuation process can be tricky, but they try to utilize inhouse resources to help with speed. Sorry you've been caught in a jam.
- 3yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Quote from @John O'Leary:
5 points and 15% is insane.
not sure what you guys are talking about I see the huds weekly on refi's when people take out my HML ( private capital) if points are low then junk fee's are sky high.. rate is a tad High.. we were always 5 and 15 then had to go to 5 and 12 or so.. but when you actually perform and can close deals in a matter of days.. most of my clients just look at me as a capital partner. U have to bring 5 to 10k per file into the business to stay in business you have to get it one way or the other . then charge interest .
I have used Kiavi and lima when my bank loans were taped for new builds.. Kiavi was pretty easy.. I did new builds in charleston with Lima and their draw process I will say sucked.
But one thing everyone is missing here is these ( like me ) we make the rules if we want to change the rules we dont have to follow truth and lending.Guidelines. Bottom line to take all the risk loaning money and only making 2 points thats ridiculous far to much risk for far to little income. In my mind anyway. - Real Estate Agent · Nashville, TN · Member since 2015 · 2k+ posts · 2k+ votes3y
You're talking about big national lenders here. They aren't going to be great. I've attempted a loan with one before and stopped the process when I realized how it was going to go.
You need to find someone local that understands your market. These big time national lenders are hard to work with.
Find a local HML
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