We receive about 600 loan requests per year. Probably 35 - 40% are seeking mortgage loans that even if they receive funding their problem won’t be solved. What these “borrowers” need isn’t debt, new debt, replacement debt, or more debt. What’s really needed to put their investment on the right tract is ADDITIONAL EQUITY.

We receive loan requests where the borrowers need 80% LTV in a bail out but they can't afford payments on a current lower interest 60% LTV loan. A new loan would just prolong the inevitable. Most of these investments do have a positive net operating income BEFORE accounting for debt service. An equity infusion rather than debt would allow a positive cash flow. The questions are

1. 1. Will the resultant ROI be high enough to attract equity capital?

2. 2. Is the property the type, size, location, etc where equity capital would be interested in. Investing?

3. 3. Is the property owner realistic enough and is his ego small enough for him to accept giving up substantial - perhaps majority equity?

We have structured some equity infusions. ‘Borrowers” reject 9 out of 10 of our equity recommendations. One told me that he’d rather “go down swinging” than “walk”. What makes sense financially often doesnt play emotionally.