The Top Asset-Based Lenders for Real Estate Include Stratton Equities, Titan Funding, and CoreVest Finance
Whether you want to fix and flip a single-family home or buy a 30-unit apartment building, getting a loan for an investment property can be a challenging process. Unfortunately, the loan approval process is even tougher if you don’t have the greatest credit, a high net worth, or don’t have a ton of real estate investing experience. In these situations, asset-based lenders, also often referred to as hard money lenders or private money lenders, can be the perfect solution.
Unlike banks, which generally have strict underwriting procedures and care a lot about a borrower’s credit score, asset-based lenders mainly focus on the value of the underlying property, or asset, when deciding to provide a loan. Of course, since these types of loans are much riskier for the lender due to their higher default rates, asset-based real estate loans generally come with significantly higher interest rates and origination fees than loans from banks, credit unions, or traditional mortgage lenders. Therefore, while utilizing asset-based lending can be a great choice for many real estate investors, if an investor can get a loan from a bank, they may be better off choosing that option.
In this article, we review some of the top asset-based real estate lenders of 2024, providing information such as the loan programs each lender offers, the types of properties they fund, loan terms, and other important information.
1. Stratton Equities
Stratton Equities is a leading direct asset-based and hard money lender based out of Pine Brook, New Jersey. They offer hard money loans, soft money loans, fix and flip loans, cash-out refinance loans., multifamily loans, residential and commercial bridge loans, no-doc mortgage loans for entrepreneurs, no-doc commercial loans, and, unlike most lenders, they even offer foreclosure bailout loans.
Stratton Equities lends to clients in most of the U.S., with the notable exceptions of Nevada, North Dakota, and South Dakota. The company generally offers loans up to 75% LTV but will go up to 80% LTV in some cases. Stratton Equities' hard money loan program can deliver financing to a borrower in as little as 1-2 weeks, and loans typically have terms of 12-24 months. Stratton Equities was founded in 2017 by Founder and CEO Michael Mikhail.
2. Asset Based Lending, LLC (ABL)
Asset Based Lending, Inc., also known as ABL, is a Jersey City, NJ-based asset-based lender. ABL provides a wide variety of loan programs, including rental property loans, fix and flip loans, 2-year bridge loans, multifamily loans, new construction loans, and even loans for first-time investors. ABL lends to clients in 29 states, so while it can be considered a national lender, its’ scope is somewhat limited compared to other national lenders.
The company has funded over 4,600 projects and has issued more than $1.6 billion of loans, making it one of the country’s largest private real estate lenders. ABL provides loans with LTVs up to 80%, with 30-day rate locks and little documentation required, with some loans carrying rates of only 6.75% (as of Q2 2023). Most loans close in as little as 30 days. ABL was established in 2010 and is currently led by CEO Kevin Rodman.
3. Titan Funding
Boca Raton, Florida-based Titan Funding is a hard money lender providing a wide array of asset-based loan options. These include traditional hard money loans, residential bridge loans, commercial hard money financing, multifamily loans, fix and flip loans, retinal property loans, ground-up construction loans, commercial bridge loans, bridge-to-perm loans, cash-out refinancing, and foreign national loans.
Their hard money loan program offers up to 100% LTV on a transaction with cross-collateralization and loan sizes of $100,000 to $5 million, all while being extremely flexible when it comes to borrower credit scores. These loans can often be used for fix and flips, and other property re-positing scenarios. Once a property is stabilized, Titan Funding also offers permanent loans with terms of up to 30 years. Titan Funding is currently led by CEO John Mansour.
4. Griffin Funding
San Diego, California-based Griffin Funding is a mortgage lender offering a wide variety of lending programs, including conventional loans, VA loans, USDA loans, reverse mortgages, non-QM loans, home equity loans, and multiple other products. Unlike most lenders on this list, it generally focuses on lending to individuals who want to finance their primary residence rather than an investment property. Its asset-based loan program targets customers such as business owners, retirees, or freelancers and allows them to secure mortgage financing without providing traditional proof of income documents. Griffin Funding generally offers asset-based loans up to $3 million and allows borrowers to use a wide array of assets to qualify, including bank accounts, brokerage accounts, cryptocurrency, and retirement accounts. Griffin Funding is currently led by President and CEO Bill Lyons.
5. Capital Fund 1
Scottsdale, Arizona-based Capital Fund 1 specializes in hard money and asset-based loans for fix and flip deals, cash-out refinancing, construction, commercial and multifamily properties, and land and development situations. They also offer loans for special scenarios, such as commercial foreclosure auction loans. Unfortunately, Capital Fund 1 is not a nationwide lender and only operates in Arizona, Texas, and Colorado.
The company is known for its fast turnaround times, as it can often fund deals in as little as 24 hours, and, unlike some asset-based lenders, its loans do not carry prepayment penalties. Capital Fund 1 also provides specialized loans for experienced real estate investors and will approve these experienced borrowers for loans with LTVs up to 90%. Capital Fund 1 is currently led by Senior Vice Presidents Kevin Highmark and Tyler Larson.
6. CoreVest Finance
CoreVest Finance is one of the nation’s largest hard money and asset-based lenders, having closed more than $20 billion in loans and financed more than 140,000 units of rental property. CoreVest offers several financing options, including rental portfolio loans for investors with 5+ units, bridge loans for individual or multiple properties, build-to-rent loans, and multifamily loans.
Their popular bridge loan program offers loans in amounts between $75,000 and $50 million, with 6-24 month terms (with extensions), and loans go up to 85% loan-to-cost (LTC). Fixed and floating rate loans are available, and, unlike most asset-based lenders, CoreVest even offers non-recourse loans, meaning that a borrower’s personal assets will not be on the line should they default on their loan.
CoreVest Finance has offices in multiple U.S. cities, including Irvine, California, Hollywood, Florida, Los Angeles, California, Lake Oswego, Oregon, New York City, and Charlotte, North Carolina. CoreVest Finance is currency led by a team including Micaela Lumpkin, Chief Credit Officer, and Michael Peerson, Chief Investment Officer.
7. EquityMax
Fort Lauderdale, Florida-based EquityMax is another large asset-based lender that lends to clients nationwide. The company has funded $2 billion of loans and served over 10,000 clients in recent years, giving it a wealth of lending experience. Loan programs offered by the company include fix and flip loans, cash-out refinances, non-recourse loans, foreign national loans, and transactional funding. The lender’s popular fix and flip loan program offers loans up to 80% LTV or 65% ARV with terms up to 17 years. These loans can close in as little as 2-3 days after a title and lien search has been completed and are offered in amounts between $15,000 to $1 million. Equity Max is currently led by President Brad Emmer, who founded the company in 1998.
8. HouseMax Funding
Austin, Texas-based HouseMax Funding offers investors two main products, fix and flip loans and rental loans. Unlike some lenders, the owners of HouseMax Funding have extensive experience in fix and flips, having fixed and flipped 3,000 homes and listed and sold over $750 million in residential property. The lender offers asset-based loans starting at just $75,000 and lends up to 75% of the after-repair value (ARV). In general, they close loans in 10 days or less, and, in addition to their main loan products, they also finance construction projects as well as multifamily and commercial properties. HouseMax Funding is currently led by President and Co-Founder Alex Morris.
9. Private Capital Investors
Unlike most lenders on this list, Dallas, Texas-based Private Capital Investors focuses only on funding commercial real estate deals-- and does not fund residential real estate. The company’s hard money loan program offers loans in amounts between $1 million and $50 million, with LTVs up to 85%, terms between 3 to 24 months, interest-only payments, and highly-competitive interest rates. They also provide commercial bridge loans with similar rates, loan sizes, and leverages, though their bridge loan program has terms between 1-3 years and requires a DSCR of at least 1.25x at exit, with an “appropriate” beginning DSCR.
Private Capital Investors funds all types of multifamily and commercial property, as well as urban land, and will fund foreclosure purchases, rehab situations, non-cash-flowing properties, and foreign national loans. Private Capital Investors is currently lead by Founder and CEO Keith Thomas.
10. Tidal Loans
Houston, Texas-based Tidal Loans is an asset-based private lender that provides a wide array of financial products to real estate investors. Popular loan products include traditional rental loans, multifamily loans, hard money new construction loans, temp-to-perm hard money loans, hard money cash-out refinances, transactional funding (often used by wholesalers), and Airbnb loans for short-term rental properties.
Unlike many asset-based lenders, Tidal Loans provides no money down 100% financing (i.e. 100% loan-to-cost/LTC), provided that purchase, rehab, and closing costs do not exceed 70% of the property’s value. In addition, their hard money construction loan program also offers 100% financing for qualified builders/investors.
The company expressly states that they do not focus on credit scores, so borrowers with poor credit should not hesitate to apply. Also, unlike many asset-based lenders, Tidal Loans has an active social media presence, with nearly 2,500 Instagram followers and almost 80 five-star Google reviews, meaning that they likely provide a high level of customer service.
In Conclusion: Asset-Based Lenders Come In Many Varieties-- But Choosing The Right One Can be a Challenge
In this article, we’ve reviewed some of the top asset-based lenders in the U.S. However, if you’re about to invest in a property and want to use one of these lenders, your work has just begun. Before committing to a single lender, you should attempt to shop your deal around to as many lenders as possible (time permitting) in order to get the best deal for your individual situation. Read reviews, speak with other investors in your community, and run the numbers to make sure you’re making the choices (ideally, profitable choices) that most closely align with your current real estate investing strategy.
Frequently Asked Questions:
What is an Asset-Based Lender?
An asset-based lender is lender that focuses on the value of the underlying asset, in most cases, a piece of real estate, when deciding to provide a loan to a borrower. Unlike banks, they do not put nearly as much focus on credit score and borrower history when deciding whether or not to approve a loan. Asset-based real estate lenders are also sometimes referred to as “hard money lenders” or “private money lenders.”
Do Asset-Based Lenders Check Credit?
Some, but not all asset-based lenders check credit, and, as previously mentioned, most of these lenders focus on the value of the property, rather than the qualifications of the borrower. However, those that do check credit often have much more lenient requirements than banks or credit unions. Some private lenders that dp check credit will accept credit scores as low as 550 (or even 500), provided that the deal meets other specifications.
What Types of Properties Do Asset-Based Lenders Finance?
Asset-based lenders vary greatly when it comes to what types of properties they fund. Some lenders fund 1-4 unit properties, all kinds of multifamily and commercial real estate, and even vacant land. Some specialize in only 1-4 unit properties, while others might only finanance 5+ unit multifamily and commercial properties.
What Kind of LTV Do Asset-Based Lenders Provide?
The loan-to-value ratio, or LTV, provided by asset-based lenders can vary, as each lender has different goals and different levels of risk tolerance. Most asset-based lenders will provide between 70-85% LTV, while some lenders will go up to 100% LTV (but only if the loan is “cross-collateralized” with another property the borrower owns). Construction and renovation loans may sometimes go up to 100% loan-to-cost (LTC), but (in general) only if the predicted LTV of the finished property is 70% or below.
What are the Interest Rates for Asset-Based Loans?
Interest rates for these loans vary significantly, with some lenders providing loans at as little as 6-7% for qualified borrower. At the opposite side of the spectrum, some lenders may offer loans for 12%, 15% or even more, but these loans are typically reserved for the highest-risk situations, such as brand-new borrowers with poor credit who want to flip a distressed property.
What are the Origination Points and Fees for Asset-Based Loans?
Asset-based lenders are known for their high origination points and fees. These fees range greatly from lender to lender and can often be as high as 3-5% of the total loan amount. In many cases, these fees can be negotiated down, and, in some cases, they can be financed as a part of the loan.
What are the Terms for Asset-Based Real Estate Loans?
Asset-based loan terms vary greatly by lender, with some lenders offering transactional financing that will last as little as 24 hours (usually reserved for wholesalers). However, when it comes to longer-term loans, loan terms can sometimes start at 3 months and may extend to 3-5 years. A few lenders may offer longer-term loans for stabilized, cash-flowing properties, and sometimes allow a borrower to refinance into a 10, 15, 20, or 30-year loan program.
Can I Get a Cash-Out Refinance From An Asset-Based Lender?
Many, but not all asset-focused lenders provide cash-out refinances, though each has their own specifications when it comes to LTV, points, and interest rates.
How Fast Can an Asset-Based Loan Close?
One fantastic benefit of working with private lenders is that their loans close significantly faster when compared to banks, credit unions, or institutional lenders. Closing times vary greatly from lender to lender, with some lenders claming to close loans in as little as 24-48 hours, while others claiming a 1-3 week close time. In contrast, bank loans can often take many months to close due to the strict paperwork and underwriting requirements that private lenders simply don’t have to worry about.