All Forum Posts by: Dante Craig

I'm an property owner looking for a short-term bridge loan to cover an immediate cash need while finalizing a business sale (expected closing in the next 3-6 months). My credit has dipped temporarily due to focusing on the sale and keeping cash reserves low, but I have strong real estate equity to secure the loan. This isn't a flip—it's a straightforward bridge to hold assets until repayment from sale proceeds (with refi or property sale as backup).

Key Details on Collateral:

- Primary single-family home in NC with ~$800k in equity (after existing HELOC/HELOAN).

- Second property with ~$150k in equity.

- Adjacent 2-acre free-and-clear land parcel (clean title, valued ~$500k on parcel map and tax assessed.

- Total equity: ~$1.45M+, offering solid LTV cushion.

Loan Specs I'm Seeking:

- Amount: $200k-$500k

- Term: 6-12 months, with possible extension.

- Structure: Interest-only preferred; open to 10-15% interest and reasonable points.

- Use: Bridge emergency obligations until business sale funds hit.

If default occurs, lender would have claim on the collateral via foreclosure/deed. I have property docs, recent value comps, and business sale timeline ready for quick due diligence. Happy to discuss custom terms or provide more info via DM.

Appreciate any leads, advice, or direct interest from private lenders/investors here. Thanks!

Corey

Quote from @Dante Craig:

I'm a direct hard money lender, and my company is relatively new. We work primarily with brokers as we continue to expand our outreach. Most of our broker relationships are strong, and they bring us a good amount of business.

However, a common issue we encounter is brokers adding excessive fees, which can kill a deal and just take advantage of a borrower. When this happens, I sometimes try to get the broker to lower their fees, as our lending price is fairly set due to investor commitments and capital costs. Sometimes this works, other times it doesn't, and it can occasionally strain our relationships.

I'd love to get some input from current hard money brokers. As a lender who wants to close a deal, is it appropriate to negotiate with a broker to shave off 0.5 to 1 point when they are already making at least 1 point on the deal?

What are your thoughts on this from a broker's/lenders perspective?

What I LOVE about bigger pockets is the quality of answers to most questions - I learn A LOT by reading these posts.  My experience is the quality of the loan - as in ease of placement - often dictates what the broker thinks they could charge or how they arrive at a fee.

For example, for a $1 million residential loan, a broker friend of mine is at 1/2 - 1 point.  For the same size commercial loan he’s at 1 - 1 1/2 points.  For hard money commercial  he’s at 2 or more. 

The real crazy situations occur in commercial hard money where there’s a broker who represents the borrow, a broker who “ lender and sometimes an “introductory”broker in between, and they all want 3 points EACH, LOL. I point out to the two brokers that they’re doing HALF the job each, so they should receive HALF the normal fee.  Further, if they needed an “introduction” the borrower shouldn’t have to pay for that. It should come out of there end. 
In 80% of these situations I’ve convinced the brokers involved to settle for 3 points (or less) IN TOTAL.  The other 20% we just passed on the loan 

Quote from @Dante Craig:

Quote from @Account Closed:

As some of my colleagues have already pointed out, the size and structure of the deal really do matter here. The way my team approaches these situations is by keeping the bigger picture in mind. We’re focused on building long-term, mutually beneficial relationships — and sometimes that means negotiating down… or even up, depending on what makes sense for all parties. At the end of the day, it’s always a case-by-case decision rooted in partnership and perspective. Out of curiosity, how do you define your mission when it comes to balancing relationships and transactions?

I couldn't agree more, Leo. You've hit the nail on the head that everything in our industry is ultimately case-by-case. If you're ever in the LA area, I'd love to grab a beer sometime.

 Buddy, if you golf, we JUST became best friends... lol.. but I'll keep you posted about that beer!

Quote from @Dante Craig:

Quote from @Patrick Roberts:

On clean, fast hard money deals with a decent size (like $500k), maybe 50bps might fly. 100 bps is more realistic, especially at lower loan amounts or if there is a lot of hair on it that soaks up time and bandwidth. If you're paying any less than that to brokers, then youre probably scraping the bottom of the barrel because the good deals are getting sent somewhere else and youre only seeing the not so good deals.

DSCR loans are a different story. 185-200bps is likely the floor for those for small to midrange loans, with that tapering back as loan size grows.

Im not currently a broker, but like Devin mentioned, I probably wouldnt bother with a loan where I'm making less than a certain amount per unit of time/work. There's just too much involved and too much time opportunity cost, not to the mention the liability, overhead, EPO risk, etc. It's not just about the one loan that funds, it's also about the 3-8 others I had to find, scrub, and decline prior to funding the one decent deal. 

In my experience, the lender should be charging enough on the front end to cover the lender's margin and well as the cost of the in-house originator/LO commission on the deal, which is typically at least a point to the originator/LO. When the loan comes in from outside via a broker, that originator comp should be going to the broker, as the loan should come in the door ready to go to processing/underwriting with the broker managing the borrower relationship all the way through. If we're only talking about a broker just making a text/email intro and then passing the deal off to the lender to do all of the work, then yeah, I can see that warranting less comp, as thats more like a referral than an origination.

I appreciate your input, Patrick. I should have specified that our typical deal size is in the $500k to $1 million range, which is why I completely agree with your and Kevin's point about not bothering with loans where the compensation doesn't justify the time and effort.

From my experience on the lending side, a full point to the LO from a direct lender seems a bit high, though I can see how that might be the case in smaller markets.

What I'm really looking for are brokers who deliver a complete file from day one. I'm spending a lot of time hand-holding both brokers and borrowers just to get to the closing table, and that's not a tough model for the deals to get killed because of a 40k broker commission.

 4 points is egregious. That sounds like an ISO from the business loan broker/MCA world.

If the broker is getting full comp, they should be handling the borrower relationship, collecting any conditions/docs, etc. In other words, the heavy lifting. The underwriting should be the only thing the lender has to do. That being said, if the broker is doing all the work, the I would expect 75-100 bps in comp for midsize loans and MAYBE 50-75bps on large loans like $800k+. 

From a lender’s perspective, it’s absolutely fair to open up that conversation when the broker fee starts putting the deal at risk. After all, if the deal doesn’t close, nobody gets paid.
Bottom line: negotiating is acceptable, but the approach and timing make all the difference.

Quote from @Dante Craig:

I'm a direct hard money lender, and my company is relatively new. We work primarily with brokers as we continue to expand our outreach. Most of our broker relationships are strong, and they bring us a good amount of business.

However, a common issue we encounter is brokers adding excessive fees, which can kill a deal and just take advantage of a borrower. When this happens, I sometimes try to get the broker to lower their fees, as our lending price is fairly set due to investor commitments and capital costs. Sometimes this works, other times it doesn't, and it can occasionally strain our relationships.

I'd love to get some input from current hard money brokers. As a lender who wants to close a deal, is it appropriate to negotiate with a broker to shave off 0.5 to 1 point when they are already making at least 1 point on the deal?

What are your thoughts on this from a broker's/lenders perspective?

Broker's if residential lending are still regulated by RESPA and Dodd Frank which means you have to follow the updated laws.  DO NOT follow bad advice from other people because you will at some point be audited and every lender/broker has to have a compliance officer or department.  Reason you cannot negotiate fee's is because if you do it for one person or borrower and not everyone it fall under Discrimination.

Fines can start at $25,000.00 per day if it violates certain rules and laws under Dodd/Frank.  Here is a quick snaphot of a few:

Prohibited acts related to reducing fees

• Reducing compensation to offset changes in terms: Dodd-Frank generally prohibits loan originators from reducing their compensation to offset the cost of changes in transaction terms (often called "pricing concessions"). This is designed to prevent originators from manipulating the fees to make a loan appear more attractive initially, only to increase other costs later. However, originators are permitted to reduce their compensation to defray certain unexpected increases in estimated settlement costs.
• Varying compensation based on loan terms (excluding principal): Loan originators are prohibited from receiving compensation that varies based on the terms of a mortgage loan (other than the principal amount). This prevents incentives to steer borrowers towards loans with disadvantageous terms, such as higher interest rates, in order to maximize their own compensation.
• Charging certain fees in high-cost mortgages: Under Dodd-Frank, it's prohibited to charge a fee to modify, defer, renew, extend, or amend a high-cost mortgage.
• Charging excessive late fees: Late fees on high-cost mortgages cannot exceed 4 percent of the overdue payment and cannot be imposed more than once for a single late payment.
• Charging fees for payoff statements: Creditors or servicers generally cannot charge fees for a payoff statement.

New lender, New Loan officers, brokers, are the ones who need to pay more attention because audits are required. Your closed loan are kept for 5 year or more in some cases and it’s not worth losing your license permanently.

Hope this helps I have opened and owned several Broker branch offices, Satellite office for lenders and it's crucial to do it correct and legal to avoid fine and lost careers! Feel free to reach out if you have question.

My wife and I had dinner just last night with a fund rep and we discussed this very thing. Brokers with no background charging 4% - 6% for an introduction. It's my philosophy to build long-term relationships and actually provide value. We actually work the deal and stack the file. We also only charge 1% to 1.5% and try to be the first and only call an investor makes. If we screw them on the first deal there won't be a second. If they know we have their best interests at heart, we become a trusted advisor. It's ethical and it's good business. 

As some of my colleagues have already pointed out, the size and structure of the deal really do matter here. The way my team approaches these situations is by keeping the bigger picture in mind. We’re focused on building long-term, mutually beneficial relationships — and sometimes that means negotiating down… or even up, depending on what makes sense for all parties. At the end of the day, it’s always a case-by-case decision rooted in partnership and perspective. Out of curiosity, how do you define your mission when it comes to balancing relationships and transactions?