Writing a Mortgage Loan Request that will get you the Money

What a mortgage lender wants

The fear of loss is always greater than the desire for gain. People will not give you a mortgage, even with a high interest rate,  if they don't think they will get their money back.

Remember to always answer the four "C"s, Collateral, Commitment, Credit and Capacity

Writing your listing.

See below for responding to a lender listing on our web site.

First you need to create your FREE User Account.

Then you need to create your FREE Money Wanted Listing (You will need to log into your User Account).

There are five parts to your FREE Money Wanted listing:

The Category to place it in

Select "Place Money Wanted Listing" from the five options given. A new window will open.

First check your contact information is correct. Especially your email address. And check it every day.

Now, does your listing belong in Homes, Farms Ranches and Vacant land, Condos, Mobile Homes, Investment Property or Other?

Some listings belong in more than one section. A house you are buying to rent out for example. We recommend you create two listings, under Homes and also Investment Property.

The headline.

Someone seeing your listing will make an instant judgment as to whether or not to read on based on your headline. Is it a New Purchase or a Refinance? What single compelling thing is there about your loan request? Here are some good examples of headlines:

New Purchase: 65% Loan to Value.

Refinance: Perfect payment record 5 years.

Wanted: Quick closing for shopping center.

The fill in and checked boxes

Try to give the lender as much information as possible.
What is the property worth? How much do you want to borrow? Is this a first or second mortgage request? Do you have good credit? What is your interest rate goal (is this goal realistic)? How long do you want the loan for?

Your story.
Real Estate Description, Loan to Value and Financing Terms Offered to Lender. Explain here why the lender should make this loan and how you will repay them.

Fill in here the facts about this transaction. If you have a credit issue, here is the place to explain it. Remember, lenders are not in the business of lending money they are not likely to get back. Are you buying the property for under market value? Based on what.. an appraisal or just your opinion?
Are you in the house rehab business? For how long? How many houses have you rehabbed? What do you do with them.... sell them or rent them?

Here is an excellent example of a well worded story:

I'm looking for a commercial construction loan on a rehab property, with a cash-out option after the property is improved.

The property is a row house in a favorable suburb of Philadelphia. After-Repair Value is around $130,000, according to local realtors. I am purchasing the house for $66,000 plus a creative financing deal for the seller. It will cost about $13,000 to bring the house to top-notch condition -- rehab items include porch repair, brick pointing, plumbing repair, new kitchen cabinets and a new heater.

I am asking for a loan of about 65% of the cash purchase price of the property, so I can begin repairs. Once the rehab is complete, I would like to convert to a short-term commercial equity loan at 75% of appraised value, to get my cash back out while I sell the house.

Here's the challenge:

My business is brand new, and this is my first property, so the company has no credit history. My own credit was fine until 2001, when my employer went belly-up and I remained unemployed for 2 years, and grossly underemployed (worked at Radio Shack) for another 2 years. My credit score is now around 580, ENTIRELY due to events related to my unemployment. I have no employment other than my business. So, I'm a high risk for a lender.

In exchange for accepting the risk, I am willing to pay above-market rates, some points up front, and give the lender first position on all loans. The loans will be fully secured by the property itself. Plus, I'm going to pay my debts; I'm a good credit risk with some recent hard luck.

Please call ONLY if you are willing to shoulder the bad credit.

Thanks for your interest.

Typeface. And also, PLEASE, write in regular upper and lower case, not in ALL CAPS. Large blocks of text in all caps are hard to read. See for yourself below:

This paragraph is written in upper and lower case. It is easy to read. Making your listing easy on the reader's eyes will increase the likelihood they will read your listing. Now try to read the paragraph below.

THIS PARAGRAPH IS WRITTEN IN ALL CAPS. CAN YOU SEE HOW IT IS HARDER TO READ THAN THE PREVIOUS PARAGRAPH? MAKING IT HARD FOR YOUR READER TO READ YOUR LISTING WILL MAKE IT LESS LIKELY THEY WILL READ IT.

Place a FREE listing for money you wish to borrow (you will need to log into your User Account).

Mortgage requests that don't work on our site (or anywhere else for that matter)

We constantly see ads placed that look like this:

"We have terrible credit and no money. Can someone please lend us money to buy a house, we really want one?"
OR
"I am a 25-year old student with bad credit and no money. I would like to borrow $6 million to buy a shopping center".
OR
"Want 100% financing to buy apartment building. Zero down payment."

PLEASE! Ads like this are just a waste of your time. You're dreaming. Ask ANYONE in the street if they'd like to own a shopping center (or a hotel or an apartment building) if they didn't have a dime of their own money at risk and it didn't matter how bad their credit was. How many people do you think would refuse?

Would YOU lend your money to such an individual? Of course not. Because you know full well that the borrower has a high chance of default and you will end up losing money when you eventually go through the legal steps to re-possess on a probably trashed property.

If you have bad credit and no money the only ways to buy a home are to buy it for well below market price (and get a high interest hard money mortgage), buy a HUD or VA foreclosure or to get a lease option on a home.

Mortgage requests that do work

But let's change them a little. Same facts as above but now the borrowers have found good deals.

"We have a house under contract. It has been independently appraised at $100,000 when fixed up. The tax assessment is $80,000. We have it under contract for $55,000. The appraisal states that it would cost $10,000 to fix it up. But we hope to reduce this as we will be doing much of the work ourselves. Our credit is not so good and we only have $2,000 to put down. We would like to borrow $65,000. We need $55,000 to close and have no objection to the other $10,000 being held in escrow pending inspection that the work has been done properly. We would need stage payments released. We are looking for a maximum loan period of 24 months as we intend to clean up our credit and then re-finance."

"My uncle has owned a shopping center for the last 20 years. He owns it free and clear. He wants to cash out and retire as his health is not so good. The net income after expenses but before depreciation is $600,000 a year. This allows for a 5% vacancy factor and 10% for leasing expenses and professional management. He has offered it to me for $4 million. As I'm an inexperienced student I would keep the professional management in place. An appraisal would indicate a value of about $6 million."

"We have been renting the same house for the last 8 years. The landlord wants to sell it as he is moving out of state. It is worth $100,000, which is the sales price. We are able to put $3,000 down, we will need a first mortgage of $70,000 as he has agreed to hold a second of $27,000. Our credit isn't too good after an on the job accident that had me laid off for 4 months. But we have both held the same jobs for over 5 years now. This will be our only debt. We have paid-off our cars."

How to respond to a Lender or Mortgage Broker Listing

Please read these notes before you search our database of lenders and mortgage brokers.

Firstly, what type of mortgage do you want?

Do you have excellent credit trying to get the best terms on a conventional loan, are you a real estate investor who wants short term money so they can fix and flip a property for a profit or are you a first time home buyer with limited funds and so-so credit? This will determine the type of lender or mortgage broker you should be searching for.

What a lender or mortgage broker will want to know to consider your mortgage request.

Contact details

Make it easy for lenders to contact you. Give a VALID email address that you check often, day and evening phone numbers and a fax number if you have it.

Answer for them the 4 Cs.

What is the Collateral. The street address of the property. It's size, what it is worth and how you got that value (recent purchase, comparable sales in area, appraisal etc.) For more information on what lenders like to know about the real estate.

How is your Credit? You should not allow the lender to run your credit report at this time, or send it to them. You should tell them your credit score. But you should know what your credit is like and also check for any false information on your credit report so you can get it removed. Obtain your credit report on line.

What is your Commitment? How much of a down payment are you making?

What is your Capacity to repay this mortgage? Briefly, how much do you make, what is your career and how long have you been employed there. What other regular debts do you have?

Find a Lender or Mortgage Broker.

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