The interest rate cut that many commercial real estate investors are waiting for has not yet materialized. It is no wonder, then, that traditional banks are still not very accessible.
Even if they are accessible, their slow and complex approval system can be a disadvantage in competitive markets.
If you want accessible and quick options, you should consider CRE financing providers instead. These companies provide equity financing, debt financing, transactional funding, and gap funding, among others.
Furthermore, as the use of earnest money in commercial real estate has become normative, many of them also provide earnest money funding.
In this article, we consider five of the best private money lenders in the US.
1. Duckfund
Duckfund is a CRE financing company that provides earnest money funding, equity funding, and debt funding for commercial properties across major US states and the Sun Belt.
Best known for:
Duckfund is best known for quick access to funds and support for investors operating in competitive markets.
Key advantages:
• Quick disbursal: Duckfund disburses funds within 48 hours after approval.
• Accessibility: You don’t need collateral or a credit report.
• Variety: You can access preferred equity, LP/co-GP equity, and senior debt financing for commercial properties of your choice. Duckfund also provides earnest money financing at the beginning of the deal.
• Transparent fees: Duckfund does not charge any hidden fees.
Ideal for:
Duckfund is ideal for investors operating in competitive markets.
2. Levine Capital
Levine Capital is a private equity firm that provides EMD financing, new construction loans, Debt-Service Coverage Ratio (DSCR) loans, bridge loans, transactional funding, gap funding, and joint venture equity.
Best known for:
Levine Capital is best known for quick access to funds.
Key advantages:
• Nationwide reach: Levine Capital supports new and experienced dealmakers across the US.
• Flexibility: You can choose from a wide variety of creative financing options (gator lending), in addition to well-known financing methods (bridge loan, DSCR loans).
• Speed and accessibility: Their approval and fund disbursal process is smooth, fast, and accessible.
• Resources for investors: Levine Capital also commits itself to educating CRE investors on how they can become more profitable.
Ideal for:
CRE investors with a quick need for funds.
3. Private Capital Investors
Private Capital Investors (PCI) is a financing company that provides CRE loans, bridge funding, hard money loans, and stated income loans.
Best known for:
PCI is best known for supporting both mid-market and large-scale projects.
Key advantages:
• Accessibility: PCI is willing to work with CRE investors with imperfect credit profiles.
• Competitive rates: They offer rates as low as 5.99%.
• Fast approvals: All loans are approved within 24/48 hours. Depending on the type of financing, funds are disbursed within 14 days.
• Diverse options: You can choose among bridge loans, stated income loans, and hard money loans.
Ideal for:
PCI is ideal for investors with imperfect credit profiles.
4. GoKapital
GoKapital is a financing company that provides commercial mortgages, hard money loans, and rental investment property loans.
Best known for:
GoKapital is best known for its transparent fees.
Key advantages:
• Long financing term: Their commercial mortgages and rental investment property loans have terms up to 30 years. Even the hard money loan has terms up to two years.
• Accessibility: Only rental investment property loans require a minimum credit score of 660. The others are more accessible.
• Competitive rates: Interest rates start around 5.9% for rental investment property loans and 7% for commercial mortgages and hard money loans.
• Broad loan amounts: Commercial mortgages range from $100,000 to $50 million.
• Nationwide coverage: They provide funding for CRE investors across the US.
Ideal for:
GoKapital is ideal for investors looking for fast and flexible funding.
5. EMDCC
EMDDC is a financing company that provides short-term funding that includes earnest money financing, double closings, seller carrybacks, and transactional funding to CRE developers and investors.
Best known for:
EMDCC is best known for placing a premium on experience when evaluating funding applications.
Key advantages:
• Quick funding: EMDCC will disburse funds within 72 hours of application.
• Maximum funding: Maximum funding is $100,000 for EMD, $100 million for double closings, and $1 million for seller carrybacks.
• Competitive financing fee: Double closing rates vary from 1.5% to 3%, while seller carryback rates are 2.5%. For EMD, there is an upfront fee of $500 or 1% of the deposit amount and a 40% return for 30 days.
Ideal for:
EMDCC is ideal for wholesalers in need of short-term funding.
Final thoughts
Duckfund provides a good combination of both short-term and long-term financing.
While providing earnest money financing, like Levine Capital and EMDCC, it also provides debt financing for the property’s purchase price, like GoKapital. However, it goes a step further by offering two equity financing options.
Also, Duckfund provides an exciting combination of speed, accessibility, and flexibility that’s hard to match.
It provides all types of funding within 48 hours of approval, and does not require a credit check for any of them. Investors can choose between equity and debt financing for the purchase price, and they can request higher EMD amounts to gain an edge in competitive markets.
Source: Top 5 Best Alternative CRE Financing Providers in the US
