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New ConstructionResidential Hard Money Loan

Indianapolis Residential Hard Money Loan

The owner is planning to build a 2.5-floor single-family home with four bedrooms, three full bathrooms and one-half bathroom on a 4,178 square foot site. The site is located on the south side of Tropical Drive on the North Side of Heron Lake, in Indianapolis in Marion County Indiana.

Annual Interest Login for details
Term Remaining 11 Months
Payment Monthly
Offering Size $340,000

Indianapolis Residential Hard Money Loan Details

Structure

Tax Document
1099-INT
Offering Structure
BPDN
x

SENIOR BPDN - PROMISSORY NOTE SECURED BY COLLATERAL SECURITY AGREEMENT

THIS PROMISSORY NOTE IS SECURED BY THE ISSUER'S PLEDGE OF THE RELEVANT UNDERLYING COLLATERAL LOAN (AS DEFINED BELOW) TO THE LENDER (AS DEFINED BELOW) UNDER THE COLLATERAL SECURITY AGREEMENT AND PROMISSORY NOTE. HOWEVER, EXCEPT TO THE LIMITED EXTENT PROVIDED IN THE PROMISSORY NOTE WITH RESPECT TO THE UNDERLYING COLLATERAL LOAN, THIS NOTE IS NON-RECOURSE TO THE ASSETS, FUNDS AND ACCOUNTS OF YIELDI, LLC (THE "BORROWER", "COMPANY" OR "ISSUER") OR ANY OF ITS AFFILIATES, EMPLOYEES, AGENTS, STOCKHOLDERS, PARENTS, OR SUBSIDIARIES EXCEPT TO THE EXTENT OF THE VALUE OF COLLATERAL LOAN NET PAYMENTS ACTUALLY RECEIVED IN RESPECT OF THE UNDERLYING BORROWER LOAN.

Example Return on Investment

Investment Amount:

Annual ROI:

$0

Why We Like This Opportunity

Property Highlight

The owner is planning to build a 2.5-floor single-family home with four bedrooms, three full bathrooms and one-half bathroom on a 4,178 square foot site. The site is located on the south side of Tropical Drive on the North Side of Heron Lake, in Indianapolis in Marion County Indiana.

 

 

About the Neighborhood

Subject property is located in Marion County and is situated in the central part of the state. Indianapolis is an urban area and serves as a major economic and cultural hub for the region. It is not far from other major cities like Chicago, Cincinnati, and Louisville. The economy of Indianapolis is diverse and robust, with a strong focus on sectors such as manufacturing, healthcare, education, and finance. The labor market is competitive, offering a range of job opportunities across various industries. The housing stock in Indianapolis consists of a mix of single-family homes, townhouses, apartments, and condominiums. There are options available for residents and visitors, with a range of prices to suit different budgets.

Why We Like this Loan

This is a great repeat borrower of Yieldi who successfully built a home and recently refinanced us after it sold. The borrower has built and sold multiple homes on the street and proved to be a great borrower on the first deal we did with him. His product is well known in the area and he builds a quality product at an affordable price point. The borrower also has a really good understanding of the area and takes advantage of the lakefront properties that he’s accumulated over the years.

First Priority Mortgage Lien Position

Seniority

The first-priority mortgage lien position is the most senior and highest priority within the capital structure. In the event that a borrower defaults, the lien priority determines the order in which lenders are repaid. Senior lenders are always repaid first. All subordinated positions, including the amount held by the Originator and its investor syndicate, act as a buffer in the event of a deterioration in the Properties’ value.

Personal Guarantee

Personal Guarantee

The Loans are personally guaranteed by the borrower, spouse, and all principals in the LLC. Additionally, the Sponsor and/or Guarantor are obligated to contribute monthly payments to maintain a tax and insurance reserve. Failure to adhere to reserve contribution requirements would lead to the triggering of a debt service and operating expense/shortfall guarantee.

Upfront Reserve

Upfront Reserve

The Loan is structured with interest reserve for further protection.  12 months of debt service payments will be collected at closing.

What Should I Consider When Investing in Indianapolis Residential Hard Money Loan?

Borrower Risk

The Borrower may not have represented itself accurately.

Risk Mitigation

  • The Originator checks the Borrower's credit history via a third-party credit reporting company.  The Borrower has a 700 credit score.
  • The Originator considers the underlying asset to be the primary source of security.
  • If the Loans are not fully repaid after the Lender has exhausted other sources of repayment, the Borrower has provided a personal guaranty to fulfill any deficiency.

Default Risk

The Borrower may default on his financial obligations.

Risk Mitigation

  • If the Loans are not fully repaid after the Lender has exhausted other sources of repayment, the Sponsor has provided a personal guaranty to fulfill any deficiency.
  • In the event of a default, a direction letter signed at closing by the Borrower will be sent redirecting the Tenant to make rent payments into an account controlled by the Originator.

Investment Summary Of Indianapolis Residential Hard Money Loan

Investors have an opportunity to invest in borrower payment dependent notes, the cash flow of which is dependent on the payment of interest and principal repayment on the Loans. Investors are scheduled to receive an annualized monthly interest payment of Login for details over the Loans' estimated remaining term of 12 Months. Principal is expected to be returned on or before maturity through a refinancing with a traditional bank loan. It is important to note that the Loans are eligible for prepayment, and principal may be repaid prior to the 12 Months estimated remaining term. If the Loans are paid off before maturity, investors are expected to receive at least three months of interest payments in addition to return of principal.

How Do I Get Paid?

This loan had an initial term of 12 Months with an option at Yieldi's discretion to extend. As of May 23, 2024 there are 12 Months remaining. Investors will immediately receive monthly interest payments at an annualized rate of Login for details on the principal balance over the life of the loan. If you invest in this loan in the middle of a month, you will receive a prorated interest payment for your investment for your first investment month and then full monthly payments thereafter. All payments are made automatically via ACH on the 1st of each month and investors all paid by the 10th of the month.

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