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Eligible Borrowers
The property is the primary collateral for each loan. You don't need to furnish financial statements or income tax returns to get a loan. However, your credit and ability to repay the loan are both considered in approving you as a borrower. If you would like to become an approved borrower, submit an application and the application fee of $25.00. Once you are an approved borrower, Watershed will be able to provide you with a pre-approval letter to submit when making offers.
Eligible Properties
We lend on single family houses in Northern Virginia, Mayland, and Washington DC that appraise for $70,000 or more on an “after repair” basis. We do not lend on manufactured homes, condominiums, vacant land, commercial properties, mixed-use properties, multi-unit properties, or houses being moved to a new location.
Loan Amount
The loan amount is 65% of the “after repair value” of the property. Here are some examples:
Loan Funding
A part of the loan amount , equal to the estimated cost to bring the property to a good, marketable condition, is held back by the lender as a “rehab reserve”. Rehab reserve funds are released to you in draw payments as work is completed and inspected.
The balance of the loan amount is first applied at closing toward the purchase price and other acquisition related costs. Borrowrs must bring at least 5% of the loan amount as cahs (cahsier's check) in the deal at closing.
Terms
First lien notes only, with a mortgagee (lender) title policy.
Interest only payments.
A loan term of 6 months.
A builder's risk hazard insurance policy or a vacant dwelling policy for the 6 month loan term is required to be in force at closing. Flood insurance is required if the property is in a FEMA designated flood zone.
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