Frequently Asked Questions
One West will typically lend no more than 65% to 70% of a property’s ARV (After Repair Value). So, what does that mean exactly?
If you purchase a home for $100,000 and invest $35,000 into rehabbing the home, then the property should be worth roughly $180,000. Using this simple example, One West would lend you up to 70% of $180,000 or $126,000 in this case.
All of our loans must be secured by a first position lien. If you have a current loan, we can still make you a loan but your current first position loan must be replaced by One West’s new first position loan.
12% annual rate interest only – if you have a loan for $130,000 your monthly interest payment would be calculated as follows: $130,000 x 12% / 12 months = $1,300 monthly interest only payment.
6 month interest only loan term – after 6 months you may renew the loan.
2.5% origination fee – if you borrow $150,000 x 2.5% = $3,750 origination fee.
$750 application fee.
Other fees: you will incur typical closing costs at the time of closing for items such as: recording fees and title insurance policies (purchaser and lender). These are all ordinary closing costs.
No pre-payment penalty.
No appraisal fee.
Yes, we can lend money for the construction portion of your project. How does that work? At closing, any funds that are to be used for construction purposes only will be held by the title company’s disbursing office. The disbursing office will only release funds after you turn in the necessary paperwork such as an invoice, lien waiver, and copy of the check payment. In addition, One West will physically verify the work has been completed. Each draw request costs $295. The project size and scope plus your experience level are critical to determining how much construction money we may lend on a project. The total amount we will lend on any project is 65% to 70% of the ARV (After repair value).
Some investors enjoy self- performing all the construction work and others like to hire a professional contractor who they can oversee complete the project. Either approach can work just fine but the important understanding is that you must start with a detailed plan. What does this mean? This means you must be involved and do your homework. You can trust people, but you still need to verify what they tell you. Real estate investing involves working with contractors who are vital to your success. However, I regularly see projects go over budget because an inadequate understanding of what work actually needs to be done and how much that work will cost is never compiled before the project starts. Do not hesitate to reach out and discuss any rehab challenges you may have.
Nobody will be a better advocate for your deal than you. Make sure you start procuring your insurance weeks before you close. We require proof of a builder’s risk insurance policy that must be pre-paid for 6 months in order to close your loan. You must submit a certificate of insurance that lists One West Associates, Inc. as the mortgagee. You must also evidence you have General Liability coverage limits of $1,000,000 and list One West Associates, Inc. as an additional insured.
Once you have a property under contract you need to communicate regularly with the title company. Title companies may need additional documents from you. Sometimes issues may arise when it comes to title matters so stay on top of your deal. If the title requests are not addressed promptly, it can delay your closing.
10333 Clayton Road
St. Louis, MO 63131
314-768-9639
Two to three days before closing be sure to request a HUD settlement statement from the title company in order to verify the exact amount of money you need to close. You will need to either wire the funds or deliver a cashier’s check in the amount you need to close. No personal checks are accepted. This is important and needs to be addressed before the actual closing date, so no delays arise.
We only lend in these Missouri counties.
- Saint Louis City
- Saint Louis County
- Saint Charles County
- Jefferson County
- Franklin County
- Warren County
- Lincoln County
No. We only lend money to an entity such as an LLC. You must personally guarantee the loan. If you have a spouse they must sign a marital waiver only if they are not a partner of the LLC.
No. Our loans are intended for investors who do not reside on the property.
Common sense underwriting is always our approach. We want to know how much experience the borrower has when it comes to not only buying and selling homes but managing a rehab too. If the borrower has minimal construction experience, then we expect the proposed rehab to be of a reasonable size and scope. We look at how much cash the borrower is working with today. We do not lend borrowers 100% of the money needed to purchase and rehab a single project. A borrower must have cash in the deal too. We visit the property to evaluate the area, the home, and the size of the construction project. Overall, the deal must make sense when it comes to the investor risk and exposure a property presents in relationship to the profit that can be made.
Another item we look at includes a flood certificate determination. We determine if a property is in a flood plain. If so, a flood policy must be purchased before the closing. If a property sits in a flood zone which requires a borrower to buy a flood policy in order to secure financing, it can negatively affect the value of the property.
We review an entity’s certificate of good standing. This document demonstrates the entity was legally formed and has been properly maintained.
Our application requires that you submit each borrower’s driver license, 3 months of (personal) bank statements, and your most recent tax return.
Absolutely. We do not mind sharing the names of professionals that we have used before. We have contacts that range from tradesmen to local banks and just about anyone else you may need. It is important to build out a reliable team that you can use over and over. Always be on the lookout for great people who can help you execute your investing plan.