Investing in real estate is not a one-trick game

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Ignite Funding, a hard money lender, experienced no defaults in 2020 – a trap many lenders and developers have been unable to avoid due to the global pandemic. Ignite Funding took this advancement hard, knowing that many in the credit industry were not unharmed.

Ignite Funding attributes this success to their lending philosophy and the various steps they are taking to reduce the company’s overall exposure to risk.

Risk mitigation is extremely important as Ignite Funding’s sole purpose is to enable thousands of investors to participate in real estate investments through trust deeds.

The One Size Doesn’t Fit All Philosophy

Ignite Funding does not take a one-size-fits-all approach to lending. This flexibility allows Ignite Funding to work with proven developers with different backgrounds and product types.

In other words, Ignite Funding doesn’t put all its eggs in one basket, lending only one type of property built in one specific region. This allows Ignite Funding to stay ahead of real estate trends and maintain a diverse portfolio that was needed during market fluctuations.

“We understand the importance of not limiting our funding and being flexible in the ever-changing real estate market,” confirmed Pat Vassar, Director of Underwriting at Ignite Funding.

“Our success is based on identifying borrowers who understand the need for real estate products and getting them to market at the right time. This includes the ability of the borrower to recreate himself and develop with the market as needed. “

Ignite Funding usually provides loans in the western US states, but is open to work with bankable borrowers in non-judicial states with a long history in the region and a solid track record. Ignite Funding mainly provides loans for the acquisition and horizontal and vertical development / restoration of residential and commercial projects.

For example, investors have the opportunity to invest in projects ranging from rebuilding the Huntridge Theater in downtown Las Vegas to refurbishing apartments in Sierra Vista in Arizona to converting shopping malls into lifestyle centers on the outskirts of Boise, Idaho.

This level of diversification allows investors to optimize and mitigate risks within their individual real estate investment portfolios.

The Loan-to-Own Philosophy

While Ignite Funding leaves the door open to new opportunities, that doesn’t mean they agree to fund every project that comes in.

“Only about 10 percent of the loans that come through the pipeline are approved for funding,” Vassar said. “This applies not only to borrowers who may be new to Ignite Funding, but also to repeat borrowers.”

This is due to Ignite Funding’s philosophy of “property loans,” which means that while the underwriting process includes a thorough due diligence of the borrower to ensure that it is a financially sound company, the focus is on the property and borrower in question. prospective exit strategy.

“Even the best borrower is only good until they get bad. After all, your main source of recourse to the court will be the property that you take as a foreclosure, and if you can sell the property as intended, ”Vassar said.

Key performance results in 2020

Ignite Funding prides itself on its ability to continually maintain the success of its borrowers and, in turn, provide quality investments to its investors.

As of the end of December 2020, Ignite Funding had US $ 175 million in loans under management and paid out US $ 14.3 million in interest income to investors.

To date, Ignite Funding has made 1,376 real estate investments financed with $ 907 million in equity capital, providing 51 borrowers in 16 states with the opportunity to acquire and develop over 12,000 acres of land, 8,100 residential lots and 3.5 million square feet of commercial areas. …

Visit ignitefunding.com to view Ignite Funding’s annual reports since their inception in 2011.

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