Anyone every use Constructive Loans?

36 Replies

Anyone on here try Constructive Loans or work with Account ClosedIt seems like a bait and switch to me! 

All said and done it cost me an additional $2300 in fees for the HML that went past its maturity date plus the appraisal, all this could have been avoided if they told me they had an issue with my credit score from the beginning.

Also, it should be noted that my conventional broker was able to close the loan in 3 weeks and had no issues with my  credit with no points of course.  

Anyone else successfully and use Constructive Loans and been happy with them?

https://www.biggerpockets.com/forums/517/topics/693204-fix-and-flip-and-low-doc-rental-loans

Edited to add: I just tried to comment on the thread they posted 2 days ago and got an error message that I'm can not post a reply....... hmmmmm, perhaps they don't want the truth to come out.

Mark 

I briefly heard about this company from an investor friend few months ago, I tried to google but not finding much online information about them either. I emailed the company recently and they are now operating under Fay Mortgage Services. I have yet to find anything else on them. 

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After my experience with them and it costing me almost $3k all said and done because of they didn't come thru with what they said, I wish I had never heard of them either..... 

Unfortunately , this seems to be a common bait and switch scam . I am slightly ok with the broker not being able to suggest the best product or charging 500 more for this and that , But what you mentioned is very concerning .

It could be some ones first deal and they might completely drop the idea of pursuing this route . That is teh reason why we see on forums that - construction loans are tough , 203k s are tough and so on . 

Ofcourse they have certain rules , some of which I might agree , some I might not , but at the end of the day , that is the case in every aspect of real estate investing .

Anyway , I have researched extensively on using construction loans , and am doing a rehab with that approach , learnt a ton of stuff - If you ever consider that route , dont hesitate to get in touch via BP - I can review my notes and perhaps give some pointers

The first page on this website says "NO surprises" lol.

@Karen Strattan hopefully you have better luck with them but if they change something last minute I wouldn't be surprised at this point. I typically don't say anything negative but this was a straight up bait and switch, with the change coming after hours on the night before closing. I'm pretty sure they thought they had me in a corner since the term on my HML ended the following morning, which was supposed to be the closing date.

@David Des this wasn't even a construction loan, it was a straight up cash out refi from a house I did a renovation on using a HML lender, house was completed, occupied with good cashflow and the appraisal came in right where it should have.....

@Mark Faustrum Got it , I was confused by the name of the company :-) yeah that is even more horrible , but bait and switch is a common tactic for some bad lenders . 

The best we can do is to share our experience and drive business to the Lenders who operate with integrity and make it a win win

Also on a different note , I think there are safeguards in place to prevent such behavior . I think we were supposed to get the finalised numbers three days before the close date and the lender would have repercussions. I dont remember what we call this . 

Perhaps its a good idea to understand this process and make sure , the lender is adhering to this. If a lender is not adhering to this common safeguards then that would be my first red signal . I wouldnt rule them out completely but I would try to understand why they are not respecting that rule . 

Hi Mark, I've been approved for an LOC through them, but had to withdraw from the purchase of the property. So I haven't actually used them yet. I was told however to expect an average of 30 days to close a loan with them. The rep I'm working with, Timothy Corr, seems to be a straight shooter. I'll update you here if we go forward with another property.

I really appreciate you us giving a heads up here and am sorry for what you went through with them. With your experience in mind, I’m going to get established with a few other lenders before I offer on another property and count solely on Constructive. 

Constructive kept me strung out for over a week, submitting doc and after doc after doc, only to tell me at the end, "Well, it doesn't look like you have enough liquidity."

No sh!t, Sherlock! Liquidity is what I was after. Why didn't you make your liquidity requirements known upfront and save me a lot of time and trouble?

I told them they are nothing more than bank loan officers, whose job is to sit and wait for someone to come in, hand them an application, then walk it down the hall to the loan committee. Give me a stalk of bananas and 15 minutes with a chimp and I can teach him that job.

@Mark Faustrum

Hi again, I wanted to let you know that I just closed on a property with Constructive Loans. The interest rate ended up at 9.3% with a 9 month term, interest only payments. The purchase price was $126,800, and the property appraised for $198,000. My loan amount is $138,600, with a holdback of around $24k, to be disbursed in percentages as I make the improvements as per the scope of work I submitted to them. My cash in was 10% of the purchase price plus paying upfront for the appraisal ($660).

They have very stringent requirements as to documentation, and they charge fees and points, but Tim Corr, the lending agent, was upfront with these, and he was also on point, making sure that all my T’s were crossed and my I’s dotted.

So...the loan was funded, and we closed on the scheduled day.

Based solely on my experience, I recommend them as a reputable lender.

@Kat Prater I'm glad it worked for you, perhaps they are better as a Hard Money Lender, I was going for a 30yr fixed rate mortgage and we see how that worked. As I mentioned my contact person was different but it is what it is, you are the first person to even respond that they successfully closed a deal with them, either way anyone the searches on here or Google will be able to see what I experienced and truth be told I've never made a negative online comment or review about any company before, I'm usually of the mindset "it is what it is" but my situation was a different experience where they were committing a certain rate/term and confirming all was good until after business hours on the day before closing - sorry but that is just SHADY!

Originally posted by @David Des :

Also on a different note , I think there are safeguards in place to prevent such behavior . I think we were supposed to get the finalised numbers three days before the close date and the lender would have repercussions. I dont remember what we call this . 

Perhaps its a good idea to understand this process and make sure , the lender is adhering to this. If a lender is not adhering to this common safeguards then that would be my first red signal . I wouldnt rule them out completely but I would try to understand why they are not respecting that rule . 

HML are exempt from the rules you state.. those rules are for NMLS registered and licensed lenders doing owner occ or Freddie fannie backed mortgages.. FHA VA that type of loan.. on investors loans there are no rules like this.. if they want to change the terms they legally can and the borrower can refuse to close and then let the world know about it like what is happening on this thread..

 

@Jay Hinrichs as always you are correct, I didn't pursue anything further other then asking on here if anyone had actually closed with them, I just took my lump and moved on. I had previously used LendingHome as my HML but they stopped lending in Illinois, I asked a local investor @Mark Ainley who referred me to the Eric Workman the VP of lending for Renovo Financial, they are local (Chicago area), met with him and felt we hit it off well. At the moment I am in the process of funding my 3rd project with them since April and have been very happy with their whole team. They are on the ball, respond quickly, can and will fund within 10 days if needed and I have had nothing but positive experiences with them and highly recommend them for anyone looking for a HML in areas that they lend in. 

BTW: I feel like I've met a movie star just to have you comment on one of my posts, LOL! In all seriousness sir, your decades of experience and daily helpful insights, direction and comments to thousands of investors and ten times as many want to be investors on here has not gone unnoticed. You are an inspiration to many that read these forums whether they jump into the pool or not, personally I'd like to thank you for taking time out of your busy day to educate us all.

My hats off sir.... 

Originally posted by @Mark Faustrum :

@Jay Hinrichs as always you are correct, I didn't pursue anything further other then asking on here if anyone had actually closed with them, I just took my lump and moved on. I had previously used LendingHome as my HML but they stopped lending in Illinois, I asked a local investor @Mark Ainley who referred me to the Eric Workman the VP of lending for Renovo Financial, they are local (Chicago area), met with him and felt we hit it off well. At the moment I am in the process of funding my 3rd project with them since April and have been very happy with their whole team. They are on the ball, respond quickly, can and will fund within 10 days if needed and I have had nothing but positive experiences with them and highly recommend them for anyone looking for a HML in areas that they lend in. 

BTW: I feel like I've met a movie star just to have you comment on one of my posts, LOL! In all seriousness sir, your decades of experience and daily helpful insights, direction and comments to thousands of investors and ten times as many want to be investors on here has not gone unnoticed. You are an inspiration to many that read these forums whether they jump into the pool or not, personally I'd like to thank you for taking time out of your busy day to educate us all.

My hats off sir.... 

WEll !!! you just made my day.. thank you for the kind words.

Renovo is for real and those I know in Chicagoland have used them one of my clients used them or uses them and I was a partner on one loan they did for us.. ( silent partner) I met one of the principals at a Christmas party in Chicago one time or no it was an open house. 

Anyway,  and Lendinghome does a very nice job.. I wonder shy they pulled out of IL. ?

I like to tell folks that are looking for HML to pop on lending homes website they have a very nice pricing matrix they don't hide behind any vagueness in their rates.. so that is a nice baseline to see what real rates are for your experience level Fico and down payment..

good luck with your projects.

 

@Jay Hinrichs I agree LendingHome was good, they did lend to me in my personal name and didn't require an LLC so that might have had something do to with it, they just told me they weren't lending in Illinois "at the moment" but that was as of Jan 2018 I believe and to my knowledge that hadn't changed. If the dynamic had been as simple as "you need an LLC" I would have gotten one for them, in fact Renovo pre-approved me but did require an LLC prior to closing, in Illinois can be done on line and I think it a 10min form to complete, $150 fee to expedite and I had my Articles of Incorporation the next day.

I'm my opinion they are both good HML providers, LendingHome was good to me and worked with me when I had no experience so that was a plus on the flip side (no pun intended), Renvo is top notch, I can reach out to Eric Workman, the VP of lending, anytime as I have his cell phone and he typically gets back to me right away whether its text, phone call or email. Likewise he's even taken time out of his day to see one project while it was in progress and met me to walk through a second property I was in the process of acquiring. For those looking you wont go wrong with either Hard Money Lender but personally, for me, I like Renovo Financial and have been very pleased with them. It was mentioned to me with my past experience and after 2 or 3 successful deals with them that they have another product that they will consider moving me to, from what I understand its basically a line of credit that should cover 2 or 3 projects at a time but we will see. I currently have my 3rd house with them under contract at the moment.

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