Boy, busy time in this business. Since I started this, its been three weeks and three more loans in the door. But I promised I would write about what kinds of deals we have been able to do and I will start with a simple one.

Banks absolutely hate to do loans for taverns. Our client found out the hard way even though he had great income and great credit. He was half owner of a country tavern in NE Wisconsin, and he needed to cash out the property, which was owned free and clear, so that he could pay off his partner and get sole ownership.

With a little advance planning, which meant being able to prove the tavern had a good income - (therefore every penny made went in to a bank account before it went anywhere else) - for a period of six months, we were able to secure a local investor to do the loan, which was structured as a two year, interest only, no-prepayment penalty instrument. It took about three weeks to close and here's how it broke down:

Loan amount: $113,000
Collateral value $170,000
Loan to Value ratio: 66.47%
Benefit to Investor: 1st lien position on the land & building asset.
2 points ($2,260.00) at close.
Interest earned (2yrs) $27,120.00
$2,260 closing fees+ $27,120.00 = ROI $29,380, an effective annual percentage rate of 13%.

Closing costs, including 2% plus a packaging fee for White Knight, came to under $8,500, and that included the cost of appraisals, titlework, recording fees, etc.

Our client was happy he could buy out his partner, the investor was really happy with the investment, (just saw him the other day and with the beating he just took on the stock market, he says he wishes he would have done more!) and we were happy to help both "get er done!" Both individuals involved are willing to give us a recommendation, so if you want to check us, out contact me and I will give you their contact information.