Lazard Kisel got me a month or two back. Thought I'd posted all this in another thread somewhere, but maybe I only intended to do that and never followed up. At any rate, I don't have time to go into the whole story here, but I'm pasting a copy of the last email I sent him, which is a summary of all of our previous conversations, and you'll get a flavor of what I dealt with. Feel free to PM me with questions, or reply here and I'll respond when I can.
(Transcript of email follows)
Lazard -
There seems to be some confusion about what the terms are on the loan you've offered to make. At the end of this message, I am pasting an edited transcript of our conversations, both email and text, over the last few days, because I think that makes it easier to follow the interactions that have brought us to where we are today.
Your last question in the string below, however, is: "Your initial email was that you have $300k down. True or false?" So, the simple answer is, "true." Among other things, my original email did say that.
However, I think you can plainly see in the following conversations that we chose to move away from using a partner because you said A) you could fund the entire purchase price, B) you said no down payment was required, and C) you said my partner's participation was not required. All of those statements were made by you prior to my signing your agreement and wiring you $1,270.
If your terms have now changed, and you feel you are no longer in a position to make the loan at the terms and under the conditions you stated, please let me know via return email.
As I have already told my partner his participation was unnecessary, getting him back on-board is going to be hard - so I think we need to just work under the assumption that his money is off the table.
If you still want to fund the $300k and take a 2nd-position lien, I may be able to get him back on-board - but I may not be able to find a lender who will make that loan.
Andy
Email + Text Communication String
May 31 email:
Andrew Taylor (AT): My partner and I have approximately $300k to-date. We are looking for an additional $300k, which would give us 25% of the purchase price.
Lazard Kisel (LK): We have an option of funding either $300K and take a second position or Fund purchase price to take afirst position.
AT: …can you give me an idea of the terms for the two scenarios you listed above?
LK: 1st funding $300K to complete 25%
Terms 7.5% interest and 3 points charged Up to 3 years
2nd funding $2.34 million complete purchase price
Terms 7.5% and 2 points charged with Origination fee of 0.3% of Loan Amount Up to 10 years
June 1 email:
AT: …it looks like there's no down payment required? Is that correct?
LK: Yes there is no down payment required as of now, because after appraisal and the property actually worth's that amount, we will be ready to lend 100% as we want to take a first and only lien on the property.
June 2 email:
AT: …is the loan approval contingent upon my partner's participation?
LK: Your partner is not needed for this transaction yet, can only sign as witness in the closing paper works, so we don't need his participation for now.
AT: Did my partner send you a completed application? The reason I ask, is that if he did not, and we do not need him, then I need to let him know so he can move on to another project. But if I tell him to move to another project, and then it turns out later that we need him, I may have a problem.
LK: He didn't send any application. And at closing, we need your partners to sign closing paper works.
AT: If we require his income and/or guarantee, then he and I will form a partnership, and both of us will sign at closing. If you can make the loan to just me, then I will explain to him that we do not need to form a partnership, and he can look for another deal elsewhere.
LK: If you think you want to do this yourself, very well. Just go ahead and tell him that, because we have approved 100% purchase price, and we are taking a lien on the property and it can just be you. Since you say there is nothing from him since we are approving the 100% financing, then he can leave.
June 2 text message:
LK: I saw your email. After the appraisal, if it’s worth $2,600,000 we will add the other amount.
AT: Okay, I’m sending your signed paperwork now.
June 3 text message:
LK: What did you tell your partner?
AT: I told him that I was not going to need his participation on this particular project.
LK: I thought both of you contributed the original $300k
AT: Per our emails back and forth yesterday or the day before, you didn’t need a down payment or my partner’s participation, so that’s what I told him
LK: Yes I know. But I am asking. I am the lender who needs to be clear of 100% or even more to lend my money. You should understand
AT: Understood. Thanks
LK: So who was contributing the $300k?
AT: No one. Per your email: “…there is no down payment required as of now, because after appraisal and the property actually worth's that amount, we will be ready to lend 100% as we want to take a first and only lien on the property.”
LK: Your initial email was that you have $300k down. True or false?
