To Fund or Not to Fund, · Mortgage Broker Academy

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To Fund or Not to Fund,

My referred client sent me the following referral, and a request for funds;

He says, his friend asked this:

"I’m reaching out to explore a short-term financing opportunity backed by strong real estate equity. I’m a licensed realtor and owner of a property management company, currently looking to borrow $350,000 secured by a third mortgage on my existing property (valued at $500K–$550K, with $280K already mortgaged).

The funds will be used to:

Purchase a second property ($250,000 – contract ready)

Renovate it ($100,000 – plumbing, furnace, cosmetic)

The plan is to refinance the second property after renovation and tenanting (ARV ~$425,000+) within 6–8 months, which will fully pay off your loan. The loan would be interest-only, and I’m open to fair lending rates and standard fees.

Since rental income from my first property is fully committed to existing mortgages, I’m also including an interest reserve in the loan structure — where the monthly payments (approx. $2,917) are set aside upfront, so there’s no risk of missed payments during the term.

If this sounds like a good fit, I’d be happy to send more details or set up a quick call”

How could we structure this request? Or no way we would touch this? Comments please 👇

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