The Buzz About Aggressive Lending Company

Electrical Contractor's Bank is Sold & the New Ownership Won't Renew Their Loan

SBA loan for Electrical Contractor

Loan Type: Commercial Real Estate

It happens all the time...banks are taken over by other banks and the new bank wants or needs to consolidate the loan portfolio of the bank they just purchased or merged with. Since commercial loans are usually 5-year balloons and they need to be renewed every 5 years that is the easiest time for a bank to get a loan off their books. Just tell the client they are not renewing the loan and they will either have to find a new loan from another source or they will foreclose on the property... That is the commercial game...

My client found himself in this very scenario when his small community bank was sold to a larger commercial bank. The new bank said they did not want his loan anymore and he needed to find a new home for it or they would just take over the property and sell it off to the highest bidder. This is a very stressful situation for someone who is just trying to make a living as a contractor and doesn't have the time or resources to find another commercial mortgage source.

The issue for this particular business is they were not profitable on paper for another bank to seriously look at. Banks will always determine cash-flow based on tax returns. If the tax returns are not sufficient, they will not do the deal.

They were making money...Just not showing it on tax returns. We were able to use a hedge fund who would look at the Profit and Loss statements of the company and the leases for the other tenants of the building to determine they had sufficient cash-flow to pay a mortgage.

We were able to close the deal based on bank statements, Profit and Loss Statements of the business, and a rent roll for the other tenants that were in the building. Another successful project put together! The contractor can now worry about bidding on jobs and not on financing a property!

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Gun Store in Western Suburbs was on Verge of Foreclosure!

gun store loan success story

Loan Type: Stated Income

In 2015 this gun store opened in the western suburbs in a building that the owner was able to secure with a contract for deed (land contract) with a local community bank. This building was a real estate office and had been vacant for many years. The bank was happy to get someone in there and finally had a plan to get this property off their books.

The gun store owner put up a lot of his own capital to get the place code compliant and open for business. He also put down a significant amount of money for a down payment. Not only that but every month a portion of the payment went to principal which after 3 years added up. Quite frankly, he had a lot of skin in the game.

Like all Contract for Deeds (land contracts) the lessee is given a certain amount of time to exercise the option otherwise they lose all their down payment, principal payments, and funds they spent on improving the property which was quite significant in this case.

The problem is that the owner did not have a sufficient amount of money for a down payment to get a mortgage, so we needed a lender who would look at the appraised value of the property and lend on that rather than the option price which was lower.

The other problem was that the gun store was not posting a sufficient profit yet on their tax returns to qualify for a loan of that magnitude. We were actually able to secure the loan based on Year to Date 2018 earnings instead of just focusing on the last two years which would not be sufficient.

Another side benefit from our loan is we were able to negotiate the principal of the loan down with the bank about 50K. The gun store owner now not only did not have to close his store but he had an additional 50K in equity right off the bat. So when life gives you lemons....Make that Lemonade!

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40 Year Evergreen Park Mainstay CLOSED With Only 12% Down From New Buyer!

SBA loan for evergreen park restaurant

Loan Type: SBA

In the 1970's Ken Wojcicki started his hot dog stand. He opened early that day in the morning and thought he was going to sell some coffee and danishes, but his first order was a polish sausage and fries...only in Chicago! 40 years later he is finally hanging up the spatula and moving to the desert of Arizona after a very successful career.

My job was to get the new owner, Mike Pironti, a loan to purchase the business. Mike Pironti was a neighborhood guy who managed restaurants in the past. At the time he was a union carpenter by trade and not very happy. His true love was the restaurant business, and when he saw that a long-time neighborhood fixture was for sale he couldn't pass it up! He was determined to make this happen and I was determined to find him financing.

I am so proud to say we were able to do it with only roughly 12% out of pocket from Mike. In fact, with the tax credit at close it was less than that.

How were we able to do this? Mike's cash position was limited so putting down 20% for an SBA 7A program (which is commonly the way these transactions are financed) would have made it tough on him. We had to find an SBA 504 program that would take this on. The hard part was trying to find a CDC (Community Development Company) that would do a lower loan amount, but we found one. A CDC who is trying to gain market share in the Chicagoland area was willing to take this on.

Now Mike could purchase the restaurant without the added stress of being cash-poor. That is a big deal when you're taking over a new venture. He is now the happy new owner of Wojo's in Evergreen Park! No more nail guns and 2x4's for Mike!

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Sports Bar in San Antonio Needed $540K - I Didn't Even Ask to See Their Tax Returns!

stated income loan success story

Loan Type: Stated Income

My client needed $375K to pay off the seller note for the property his bar was located in before the owner sold it out from under him. He also needed about $165K to re-do the roof and add a beer garden.

However, as you know all, banks ask for tax returns to verify income and his tax returns would not do the trick. We had to go with a lender who would look at his bank statements and see he had enough cash-flow to pay back a $540K loan.

We accomplished this and got him a 30-year loan so he could keep the building that he put so much of his life savings into. He was also able to improve his cash flow by adding revenue from the beer garden.

Another benefit was that his monthly payment went down almost $1,200 per month!

My client was very efficient at getting me the files I needed in a timely manner, so we were able to close this deal in just a little over 30 days.

  • $540,000 Loan Amount
  • Only 75% Occupancy Required
  • Up to 80% LTV
  • 30 Day Turnaround
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The Auto Mechanic Said 12 Years is Enough!

stated income loan for auto mechanic

Loan Type: Stated Income

Our client had been renting space for his auto repair business for 12 years and decided that 12 years was long enough! The location is considered a hot spot and he wanted to purchase the building before the landlord sold it to developers.

His loan application was always getting turned down by the banks for 2 reasons:

  1. Because all of his income was not reported on his tax returns and he had many expenses, his business did not reflect its true cash flow. In banker's terms, his business had an insufficient debt service coverage ratio.
  2. Banks look at the "Global Income", which includes income and debt from not only the business, but his personal portfolio as well. The auto mechanic's "Global Income" was too low compared to his debt because he took a normal salary and could not show that he could pay his bills on time based on just that salary.

We had to find a lender that did not look at his tax returns to determine the business' true cash flow, like the banks did. The auto mechanic's "Global Income" could not affect the deal, as this is a killer of many loan deals.

We secured a Stated Income loan for the auto mechanic that was based on his last 12 months of business bank statements and credit report, not his personal income. We sealed the deal with a 30-year mortgage with 25% down from the borrower. His mortgage is now $500 less per month than what he was paying for in rent! He has greater control of his business now that he owns the building, and that's the greatest asset for his business.

  • Up to 80% LTV, including cash-out transactions
  • 75% occupancy for the preceding 90 days at a 1.2 DSCR
    • No seasoning on title and the ability to use appraised value vs cost basis
    • Low liquidity - Only 3-6 months of P&I in reserves required
Other Success | Loan Info

How Do You Borrow $462,000 On A Property with An Income Of Only $2,992?

fix & flip loan not based on tax returns

Loan Type: Stated Income

My client wanted to purchase more real estate to add to her portfolio. She had a 9-unit multi-family property that was free-and-clear that she purchased from the bank a few years back. She wanted to use this property as collateral and get as much cash-out as she could.

She went to many banks, but all banks determine cash-flow based on tax returns. Her corporate tax returns were showing less than $3,000 in taxable income therefore, she would not qualify under their standards. Also, they would underwrite all her properties to make sure all her holdings cash-flow in order to approve her for a loan on this property. They consider this "global cash-flow".

We worked with a lender who does not look at tax returns or the global cash-flow of the client in their underwriting process. We were able to prove that the building cash-flows using P&L statements and her business bank statements. Unlike a bank, as long as the property cash-flows they do not even look at her other holdings.

We were able to get her $462K to use to for new purchases so she can create a little real estate empire for herself. She manages these properties and has enough income coming in where she can be a full-time parent instead of working at a job 40 hours per week. She is doing well and excited for the future!

  • $462,000 Loan Amount
  • 30-Year Amortization
  • 5-Year Fixed Rate
  • 37 Day Turnaround
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First-Time Multi-Family Investor Gets 70% of Purchase Price & $280K for Rehab!

first time investor success story

Loan Type: Fix & Flip / Bridge / Hard Money

Not bad for a first-time Multi-Family Investor! This borrower previously only flipped single-family homes. But he saw an unpassable opportunity in this 14-unit building in the Washington Park area of Chicago. The current rents are $600 for 1 Bedrooms and $750 for 2 Bedrooms. He is converting the 1 Bedrooms to 2 bedrooms and will ask $1250 per month. He is converting the 2 bedrooms to 3 bedrooms and will ask $1400 per month when done.

All the apartments will be totally rehabbed with new kitchens, bathrooms, floors, electric, etc. This will be a cash-flow cow for him when he is done.

We were able to procure 70% of the purchase price and an additional $280K for rehabbing.

  • $597,000 Loan Amount
  • 1-Year Term (Interest-only)
  • 24-Hour Approval
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Needed Capital to Purchase the Business He Managed or He Would Lose The Opportunity

need capital success story

Loan Type: Fix & Flip / Bridge / Hard Money

My client wanted to purchase a convenience store he managed for a long time from the current owner for $80K. We also had to get this done within 30 days because the current owner of the store had a friend of the family who was ready to pull the trigger on the business if my client didn’t come up with the funds. This is too small of an amount to do a business acquisition loan on and his credit was not sufficient to obtain unsecured lines of credit.

However, he had a commercial property that he had just purchased about 9 months prior that he was almost finished renovating. The property was worth about $200K in its current condition and he only owed about $50K on it. We were able to secure him $130K so we could pay off the current lender at $50K and he had $80K available to then purchase the convenience store.

He went from making about $800/week managing the store to making about $1,800/week owning the store. He also has income from the building of about $2,400/month so he has more than enough cash-flow to cover the loan using just the building’s cash-flow. His life will be forever transformed!

  • $130,000 Loan Amount
  • Cash-Out $80,000
  • 1-Year Term (Interest-only)
  • 24-Hour Approval
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Developer in Michigan Was Tapped Out, Or So He Thought!

tapped out success story

Loan Type: Fix & Flip / Bridge / Hard Money

A developer in Michigan wanted to take advantage of a huge opportunity that was presented to him to purchase 2 commercial properties. The only problem was that he currently had a million-dollar construction project he was working on and the local banks just didn’t feel comfortable extending him any more credit. These two properties were only about 40% occupied so they did not currently cash-flow as well.

The acquisition cost for the properties was $625K and they needed another $100K in rehab work to get them to a point where they could be fully occupied. He needed a lender to focus on the project at hand and not look at his global situation in order to make this happen. They looked at his past experience and payment history in order to approve the deal.

We were able to secure him $469K of the purchase price and another $75K for the rehab work. He was able to move on the properties right away. When he is done with the rehab in about 6 months he already has renters lined up to move in and the property will cash-flow like a dream. He will then be able to go to a local bank and get them refinanced, no problem.

  • $544,000 Loan Amount
  • 1-Year Term (Interest-only)
  • 24-Hour Approval
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Developer /General Contractor in a Real Pickle!

in a pickle success story

Loan Type: Fix & Flip

A general contractor/developer built a Luxury custom home and was set to close for $490K but at the eleventh hour the buyer could not get the mortgage and he was now stuck. He was really in a bad position because he would always pay all the sub-contractors at close and they trusted him to do so because they had a 30-year relationship with this general contractor. He was really embarrassed that he could not pay them and did not have a plan to get the money. He did not want to lose the relationships he had built over the last quarter century because of this. That would not be good.

Well, we were able to approve him in about 24 hours on $343K so he could pay all his subs. We would close within 2-3 weeks. He told his subs the scenario. Although they were not thrilled on waiting another 2-3 weeks to get paid, they really had no choice at this point. So, they could live with that and continue the relationship.

The general contractor now has the time to seek out another buyer for the home without the huge weight of owing practically everyone he knows. Even though it is not the ideal situation for him, this man can now sleep in peace!

  • $343,000 Loan Amount
  • 1-Year Term (Interest-only)
  • 24-Hour Approval
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Small Business Loan for Maid Service with Little Collateral

Case Study

Loan Type: SBA

A buyer was interested in purchasing a small business, a maid service in Florida, and needed a loan but was turned down multiple times by the banks. This small business consisted of a few vehicles, cleaning supplies and a client list. The banks were not interested in this type of SBA loan with little collateral, but Aggressive Lending Company was up for the challenge.

We were able to get this small business (soon to be owner) a pre-approved loan within 3 days!

  • $255,000 Loan Amount
  • 85% Loan to Value
  • 10-Year Term
  • 6% Interest Rate
  • NO Prepayment Penalty
  • NO Origination Fee
  • NO CapX Reserve Required
  • $30,000 Seller Note Allowed
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Million Dollar Laundromat Acquisition That Was Losing Money!

laundromat success story

Loan Type: SBA

Using our extensive knowledge of Advanced Credit Analysis, we were able to uncover the true cash flow value of this business in order for a lender to approve it. We were able to recast their expenses and capitalize them. This allowed us to amortize them over a 10-year period which greatly improved the cash flow of the business.

We also had to line up a lender who could do an equipment-only loan of that magnitude. There was no real estate involved in this transaction. The terms we were able to secure were a 10-year 5.75% rate on Equipment Only.

  • $800,000 Loan Amount
  • 10-Year Term
  • 5.75% Interest Rate
  • 85% Loan to Value
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After-Market Car Accessories Store Purchase of Building

car accessories success story

Loan Type: Stated Income

This business was losing money in 2012. Another challenge was this store does a lot of cash sales which is hard to prove. We had to do extensive underwriting to determine true cash-flow for the 2012 loss and document all the cash sales before any lender would truly be serious about financing the property.

The car stereo store owner wanted to buy the building because it would basically cut his rent payment in half with the collection of the rents from the other tenants. This was a savings of over $30,000 per year he could keep in his pocket if we could get it done for him!

We were able to secure 70% LTV and the use of a seller note of 10%. 30-year Amortization, 3-year fixed, and his rate was 8.49%. This was approved on a stated-income basis, no tax returns were required.

  • $750,000 Loan Amount
  • 30-Year Amortization
  • 3-Year Fixed
  • 8.49% Interest Rate (Stated Income)
  • 70% Loan to Value
  • 10% Seller Note
  • 24-Hour Approval
Other Success | Loan Info

Purchase of Chiropractic Practice Business with a Negative $200K Net Worth

chiropractic success story

Loan Type: SBA

The buyer had been working at this practice for the past year. The seller’s wife was diagnosed with cancer and wanted to sell. The borrower had a negative $200K net worth due to student loans, 650 credit score, and did not own a home. The wife worked outside the practice.

The total project cost was $179,500. We were able to secure a bank loan for $143,500 with a $36,000 equity injection from the buyer. The rate was 6% variable for 10 years!

  • $143,500 Loan Amount
  • $36,000 Equity Injection
  • 10-Year Term
  • 6% Variable Interest Rate
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Liquor Store Buyout - Only Open 2 Years

liquor store success story

Loan Type: SBA

Liquor Store Purchase (buying out the other 50% partner) which was a relative and they had two different ideas of how to run the business. The business had only been open two years. We were able to use the money he had originally put into the business as the equity. The buyer did not own a home.

We were able to secure a bank loan for $150K with an interest rate of 6% variable for 10 years.

  • $150,000 Loan Amount
  • 10-Year Term
  • 6% Variable Interest Rate
  • 24-Hour Approval
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