1. A signed purchase contract
No term sheet goes out without one. It tells me the price, the timeline, and that the deal is real.
Underwriting Guidelines
Loan Requirements
We evaluate the borrower, property, budget, available reserves, documentation, and exit strategy together. These guidelines help you prepare for a productive first conversation.
2. Purchase price at or below 70% of your realistic ARV
Use comps that actually sold in the last six months within a half mile — not asking prices.
3. A renovation budget you can defend line by line
Renovation budgets are generally considered up to $75,000. A contractor scope with real numbers beats a round estimate every time.
4. Your own funds toward the purchase
Purchase financing may be available up to 90% of the purchase price for qualifying transactions. Higher leverage may be considered when supported by borrower equity, additional collateral, or a favorable purchase price.
5. At least $20,000 in liquidity left after closing
Reserves are funds available to cover project costs, interest, insurance, taxes, and unexpected expenses. This is the number that keeps good deals on track.
6. A track record of about 3+ completed projects
Experience is one factor in the review. Newer investors may be considered when the property, budget, reserves, team, and exit strategy provide appropriate support.
7. The borrower lives locally and the property is local
You live in the area and the project is within 45 miles of Albany. Local borrower, local project.
8. An exit you can name today
An exit strategy explains how you expect to repay the loan — a sale, a refinance into a rental, or another documented repayment source.
9. A carry cost you have actually calculated
Loans are generally interest-only over 12 months, with current guidelines of 12%–14% interest and 1–3 points, a three-month minimum interest amount, and interest generally applied only to funds advanced.
10. Your $48 TransUnion SmartMove report ready to run
That happens after a signed term sheet and is paid directly to TransUnion. It is the only lender-related cost we ask for before closing; third-party closing costs still apply.
How renovation draws work
Approved renovation funds are generally advanced in draws as work is completed and verified. Draws may require inspections, invoices, receipts, lien waivers, photographs, contractor information, or other documentation. Draw procedures and timing depend on the loan documents and project conditions.
Approved draw requests may be funded promptly after required documentation, inspections, and conditions are satisfied. Timing is not guaranteed.
What can affect the closing timeline
We aim to provide an efficient initial review when we receive the basic property, borrower, financing, and exit-strategy information.
Closing timing depends on the completeness of the file, title, insurance, valuation, documentation, borrower responsiveness, and other closing conditions.
Lending terms, in plain language
Private-money or hard-money loans are business-purpose loans evaluated based on factors such as the property, project, borrower, available equity, reserves, and repayment plan — not solely on a conventional mortgage application.
- Loan-to-value (LTV)
- Loan-to-value, or LTV, compares the loan amount with the property’s value.
- Loan-to-cost (LTC)
- Loan-to-cost, or LTC, compares the loan amount with the total project cost, including eligible acquisition and renovation costs.
- After-repair value (ARV)
- After-repair value, or ARV, is the estimated value of the property after planned renovations are completed.
- Reserves
- Reserves are funds available to cover project costs, interest, insurance, taxes, unexpected expenses, and other obligations.
- Interest-only
- Interest-only means scheduled payments generally cover interest rather than reducing the principal balance.
- Points
- Points are an upfront loan fee calculated as a percentage of the loan amount. One point equals 1% of the loan amount.
- Exit strategy
- An exit strategy explains how the borrower expects to repay the loan, such as through a sale, refinance, or other documented repayment source.
Documentation and final review
Required documents vary by transaction and may include entity records, a signed purchase contract, project scope and budget, valuation information, title, insurance, financial information, and other items needed to verify the property and repayment plan.
This information is for general purposes only and does not constitute a commitment to lend. All loans are subject to underwriting, valuation, title review, documentation, applicable requirements, and final approval.
DS Capital Connect provides business-purpose financing for eligible real-estate investment transactions. These loans are generally intended for business or investment purposes and are not intended for personal, family, or household use.