frequently asked questions

A private lender is essentially an individual, broker and/or originator of loans funded with private money to people who are having difficulty obtaining a traditional bank loan. Private money lenders can work faster and are an alternative for borrowers who may not qualify for a loan. MOR Financial only brokers loans secured by real property.

Currently, we only lend in California.

Our process is easy and transparent for the borrower. Most borrowers call in to MOR and establish a relationship with an account executive. The Account Executive will guide you through all of the steps needed from inception to completion of the process. We also provide an option to submit a loan request through our website. One may also send an email to [email protected], or give us a call at (213) 784-0737.

MOR Financial offers a wide range of loan programs for residential fix-and-flips and commercial acquisitions. We also have experience with funding multifamily, retail, and medical buildings as well. Loan programs offered are specific to the deal, please call in for specific pricing.

MOR Financial handles all aspects of the deal from origination through servicing. Your note will stay in-house, and will not be sold off to outside servicers. We originate, fund, and service all of our loans. Because of that, we make ourselves available to our borrowers to assist in anyway that we are able.

Borrowers will have an Account Executive at MOR that will work with them throughout the lifetime of their career to provide them with competitive capital and help them acquire properties with creative solutions.

Unlike other private lenders, MOR will walk through deals with you and tell you when we do not see potential in a deal. We want our borrowers to be successful. Our account executive will provide training to our clients to help them identify deals more efficiently. We are vested in our borrowers success!

Loan scenarios are typically pre-approved within 24 hours. Conditional approval letters are also available.

Your credit score is a contributing factor, but we mainly rely on the value of the property and plan for the property during the loan term. When evaluating a transaction, MOR Financial evaluates numerous factors in order to balance out the risk of a transaction. Ultimately, we are an asset-based lender. If the property has equity or significant potential, we can provide a solution.

Upon approval, MOR Financial can fund a loan in as little as 48 hours. Our usual submission process is about 7-10 business days.

MOR Financial usually offers loan terms for 12-36 months with rates between 7.99% and 11.99% for most loans.

Once we have a recent application and credit report on file, we can expedite the loan submission process. However, we will still need the core property specific documents for each transaction. These are simple items. (Fully executed purchase contract, Title and Escrow info, Preliminary Title Report) If additional documents are needed throughout the submission process, your account executive will let you know quickly in order to keep the process moving.

Typically no, MOR Financial only offers loans on non-owner occupied, business- purpose properties. There are certain exceptions in which a borrower may pull cash out of their primary residence for business purposes. It is best to call in and speak to an Account Executive to see if you qualify.

Yes, MOR Financial requires an appraisal on all new loan submissions to be conducted by a licensed third-party Appraiser. We have resources all over the state and can schedule an appraisal within 48-72 hours. Appraisal may be waived in certain instances where the LTV is very low.

The more information you can provide us on your respective transaction, the better we will be able to understand the overall picture of your deal. We typically require recent bank statements, government-issued Identification, social security card, and a line item rehab estimate (if you are requesting a fix-and-flip loan).

Before the close of escrow, you will be given an estimate of costs. That estimate may include the first month’s interest to cover the next month. However, you may be funding into the month, where you will owe a payment on the subsequent 1st of the month. Typically, borrowers have this money set aside to absorb the cost of capital. In some instances, there may be so much upward potential on your respective transaction, that the points and fees can be built into the loan.

MOR Financial accepts personal/business checks, cashiers checks, money orders, bank wire, or you can have an ACH (automated clearing house) payment authorized to be deducted from your account. We do not accept cash payments in order to be in compliance with anti-money laundering laws.

For loans that are structured on the “After-Repair Value” of a property, MOR Financial is mandated by the California Department of Real Estate to hold those rehabilitation funds in a trust account. To access those funds, a request must be sent to our servicing department who will then schedule a site inspection from a third-party inspector. Upon the review of that inspection report, the servicing department will disperse funds equal to the percentage of work completed.

We completely understand if projects do not go as planned. We are willing to work with our borrowers to find solutions to keep your project and business moving forward. As long as property taxes and insurances are current, and no new derogatories have appeared in regards to the borrower or the subject property, we can typically offer extensions or refinance options to our borrowers.

Request a formal payoff demand from the servicing department with the estimated date of closing. Our servicing department can usually have that prepared in 48-72 hours.

There is no penalty for paying off your loan before time of maturity. We want our borrowers to be encouraged to move through each transaction as quickly and efficiently as possible.

A passive investor is someone who provides capital for an investment but is not actively involved in the day-to-day management or decision-making processes of the investment. They typically seek steady returns without needing to manage the details of the investment. Examples of passive investing include purchasing shares in a real estate investment trust (REIT), investing in a mortgage pool fund, or buying trust deeds that are managed by a third party, such as MOR Financial. Passive investors often prioritize minimal involvement, preferring consistent returns with lower risk exposure.

An active investor takes a hands-on approach to their investments. They are involved in managing the properties, making decisions on renovations, handling tenants, and generally overseeing the operational aspects of real estate projects. Active investors are typically more experienced in real estate and are willing to take on more risk for potentially higher returns. They are responsible for the management and profitability of their investment properties, including decisions related to property acquisition, development, and sales.

With over 10 years of experience brokering private mortgages, MOR Financial takes pride in offering highly sought-after Trust Deed Offerings (TDOs). Our notes are in high demand due to our rigorous underwriting process, which has resulted in one of the lowest foreclosure rates in the industry—less than 1%. Capital preservation is our top priority for investors. By managing every step from loan application to payoff, we’ve created our own ecosystem that allows us to monitor each transaction throughout its lifecycle and consider additional data points when assessing risk.

Our in-house Investor Relations Account Executives personally manage each Trust Deed Offering (TDO) that comes your way. They’ll take the time to understand your risk tolerance and funding limits through a series of conversations. Once they’ve identified the right TDOs for you, they’ll present them in an easy-to-understand format. If you decide to move forward, your Account Executive will provide funding instructions to wire directly to title. They will also handle all the paperwork, including vesting, title insurance, promissory notes, deeds of trust, and state-required documents. We encourage all investors to conduct their own due diligence and are always here to answer any questions you may have about the transactions.

As California real estate values continue to rise, so does the demand for financing. Our average loan size is around $485,000. You can invest with as little as $20,000 to place your funds on a loan, and we also offer additional products with a minimum investment amount of just $10,000.

Every loan is secured by a promissory note backed by a deed of trust, which is recorded with the county clerk listing you as the beneficiary. Additionally, we require borrowers to purchase a title insurance policy covering 125% of the loan amount, along with hazard insurance that meets the approval of our underwriting department.

Our servicing department collects all borrower payments and distributes them to investors on a monthly basis. Payments are considered late if received after the 10th of the month. Typically, investor payments are disbursed by the 15th or within 2-3 business days after we receive the funds.

MOR Financial evaluates several factors based on the borrower’s plan for the property. For commercial properties, we typically do not exceed 60% of the as-is value and, when necessary, we may require a Phase 1 environmental report. We also consider the borrower’s strategy—whether it’s buy-and-hold, seasoning with tenants for a conventional takeout, or making additions and renovations.

For residential properties, we have more flexibility in managing risk. We look at the as-is value, after-repair value (when applicable), renovation budgets, location, comparable sales, exit options, and more. We also rely on third-party appraisers and recent sales comps of similar properties in the area to ensure accurate evaluations.

1st and 2nd position loans refer to the seniority of liens on a property. A 1st position lien has priority and will be paid first, while a 2nd position lien is paid only after the 1st lien has been fully satisfied, followed by any additional junior liens. MOR Financial does not offer loans in a junior position behind another hard money or private lender. In rare cases, we may consider a 2nd position behind a low LTV conventional mortgage if the risk can be mitigated. To learn more about the risks and benefits of junior position liens, reach out to your Account Executive—they’re happy to help!

Trust deeds consistently deliver higher returns compared to traditional investment options. Each loan is secured by a promissory note backed by a deed of trust recorded with the county, listing you as the beneficiary. With over 10 years of experience, MOR Financial has built a strong reputation for originating and funding loans while maintaining one of the lowest foreclosure rates in the industry. We keep all loans in-house through our servicing department, and we treat our investors like partners by providing full transparency in all business practices. Our wide range of loans can cater to the unique risk tolerance of every investor.

Every investment carries some risk, but at MOR Financial, we take every step possible to minimize those risks. If a borrower doesn’t meet the terms of their loan, our experienced team is fully equipped to manage the situation. We can handle communications with the borrower, file notices of default and sale with the county, and, if the property goes to auction and reverts to the beneficiary, we’ll work with the investor to explore options that best protect their investment.

Sometimes a borrower’s business plan doesn’t go as expected. In these situations, MOR Financial can manage notices of default and sale with both the borrower and the county, while offering options to the investor if the property reverts back to them. However, we go to great lengths to avoid the NOD process because we are not a “loan-to-own” lender. Our strict underwriting guidelines help maintain one of the lowest default rates in the industry, ensuring that we support both borrowers and investors throughout every transaction.

Absolutely! You’re welcome to use a self-directed IRA to fund loans with us.

Once our servicing department receives your payoff request, we’ll let you know right away. From there, you can decide whether to roll those funds into another loan or take the full payoff—whatever works best for you!

When deciding between individual trust deeds and a mortgage fund, there are several factors to consider. Individual trust deeds provide investors with more control and the flexibility to align investments with their specific risk tolerances. On the other hand, mortgage funds keep your money working year-round, offering returns spread across an entire portfolio. To explore the pros and cons of each option based on your investment goals, give our Account Executive a call—we’re here to help you make the best choice!