While company chief operating officer and partner Glen Weinberg said there is no such thing as a single key to success, one of the biggest keys is also one of the simplest. “Honesty is one key. I don’t want to name names but there are a lot of hard money lenders
who have been sued over and over,” Weinberg said.
“There are a lot of hard money guys who have a million dollars, maybe two million to lend, and they just don’t have the market knowledge we have,” Weinberg said.
Fairview loans money in Colorado, Florida, Georgia and Illinois. Those places have one thing in common which is that Fairview has people on the ground in each state. Weinberg said the company makes a point of inspecting every property they lend on. Fairview doesn’t do appraisals and doesn’t put stock in anyone else’s appraisals. “We look at the comps, we look at the neighborhoods and we look at the properties,” Weinberg said.
One of the ways honesty comes into play, he said, is that they will not loan on properties they think are overpriced and they advise buyers not to buy them.
Another differentiator is that when someone calls a Fairview office they talk to a live person who has intimate knowledge of the markets in which Fairview lends.
Ten years ago, Weinberg said, 90% or more of Fairview’s business came to the company from other originators but that today that ratio has been reversed, with nearly all of their business coming direct from buyers or their real estate agents.
“One thing we are known for is we can fund a note very quickly, often in just a few days.” He said it is not uncommon for him to get a call from a buyer or a real estate agent just days before a closing when a traditional mortgage lender backs out at the last minute. “Time is probably the number one reason people come to us.”
Weinberg is optimistic about the future but says “some markets are a little frothy. There is a lot of capital being deployed in not so bright ways,” he said. “There could be issues out there when the market turns.”
He is bullish on the Denver area, which he says continues to be driven by the demand generated by people moving to the area. He said warehouses used for marijuana grow operations seem overpriced, though. “There are issues coming in this market. People are overpaying.”
He thinks, though, that legalized marijuana will survive the upcoming presidential election, with whomever wins likely deferring to the states, just as President Obama has largely done. With 20 states having already legalized medical if not recreational use (and more coming), this will continue to be a strong market for hard money throughout the country as banks cannot legally handle marijuana-related business.
Hard money lending is not for the faint of heart. Fairview Commercial Lending and its predecessor company Weinberg & Associates have placed more than $3 billion in