I am a newer member here and so I apologize if this question has been asked before but I am wondering if anyone has any knowledge or advice on a lender I am looking at using for a rental property purchase and whether or not the lender is legitimate or not. The lender is SEABROOK INVESTMENTS, LLC out of Edmunds WA (according to Google and their website). I have contacted them for a quote already and have gotten correspondence back (in pretty quick time too). They are offering a loan with my requested amount (80K) over 25 years (as requested by me). However the following two items included in one of the emails back from them is what I am wondering about: (1) "We charge just the loan general expenses fee (It's negotiable & 100% refundable) which is very cheap & the only feed needed to complete the loan process" and (2) "Application/expense fee which is 1% of the loan" which is under the "Terms of the Loan".
I go into detail about how to spot these fake lenders in other posts I've written, like in my response under this thread here: How do I spot scam lenders?
(Or in a eerily similar post I responded to about an hour ago here: Private Lenders/Hard Money Lenders)
I also see that someone else previously asked about Seabrook Investments in this post from a couple years ago: Private Lender Scam?
You can read my other posts for what to look out for on these types of things, but I'll just tell you that no legitimate private/hard money lender is offering $100 million dollar loans for 25 years at 4% interest:
(They spelled "million" wrong by the way.)
Just for the fun of it though, I ran a search on their "business" address listed in the "Contact Us" section of their website. And then pulled a Google street view photo:
Does this look like the bustling office of a company that's done thousands of loans and can easily whip out a $100 million+ loan in a matter of days?
But for anyone who's still interested, here is their process directly from their website:
Well, that clears that right up, no? Lol.
On a serious note, the scam here, like with most, is to get you to pay an up front loan origination fee (usually 1%), at which point you'll likely never hear from them again.
So save you're hard-earned money and ignore any lenders who contact you out of the blue online. There's just too many scammers out there preying on would-be investors and trying to take your money.
It looks like today is your lucky day, @Andrei Wogen . Don’t waste time borrowing $80k for your project. That’s chump change. With these guys offering $100 million at 4%, I’d go for the entire amount. You could easily loan it out at three times that and make a killing.
Of course, Seabrook Investments' cost of capital is going to be greater than 4% but don’t let that worry you. Why even question how they can afford to lend money at this rate when no legitimate lender can.
Plus, do you think that anyone doing $100 million loans is also doing $20k loans? (Ahh, no.)
The up-front fees and the partially finished/sloppy website? These are details.
Other than having your identity stolen, losing an up-front fee, and maybe your deal, what’s to worry about?
To be a bit less facetious, Andrei, a realistic hard money loan from a legitimate lender is going to cost you somewhere around 10% plus a few points. This is a business based on relationships, so for heaven’s sake, stay off the web. Find your lenders locally by attending local real estate clubs when they reopen. In the meantime, you can call some local club operators, ask which lenders regularly attend(ed) their club, and who have the best reputations. These are the lenders you want to meet face-to-face, or at least call, with some informed questions.
Be careful, Andrei. Borrowing anonymously from online strangers will not end well for you.