Lending, Real Estate, and How Both Sectors Could Change in the Coming Year
A Q&A with Dave Goldstein, Founding Partner, Bavex Lending When Dave Goldstein, founding partner at Bavex Lending, says his company wants to be your lender, he’s not kidding. Bavex is known for what Goldstein refers to as “the most aggressive pricing and leverage in the industry,” meaning that he and his team are determined to help real estate investors get good deals done. “We know that everything in lending is going to have some risk, so we have built our credit box in such a way that we are able to lend investors money whether they are a first-time investor or have decades of experience in real estate investing. We fund projects really focusing on the asset,” Goldstein explained. Bavex Lending offers an array of products to serve investors, from renovation loans and bridge loans to ground-up construction and rental loans on stabilized properties. “We are unmatched in our service and speed in getting our clients to the closing table,” Goldstein said confidently. “We are fellow investors, not career lenders. We built our company with an investor mindset because our team has extensive real estate experience in renovating homes, building homes, and acquiring rental portfolios. This means we understand what investors are trying to do and we understand what they need from a lender.” REI-INK sat down with Goldstein in early 2023 to talk about lending, real estate, and how both sectors could change in the coming year. Goldstein said things could look different in 12 months, but some things will remain the same. “The best opportunity will be a property that you can add value to and that is regardless of the economy, interest rates or any other factor,” he said. “It’s our goal at Bavex to help as many investors as possible get there.” The market is pretty volatile these days. From a lender’s perspective, is there room for new real estate investors in today’s market? The short answer is, “Yes.” Because we primarily look at the asset, we have tailor-made a program for people starting out in the business. At Bavex, we look first at the deal, and then we look at the investor’s experience. When you speak with a Bavex team member, we review every aspect of the project, making sure the investor’s capital is protected and that the deal is a good one. We all know that interest rates have been on the rise. How have rising rates affected Bavex Lending and its clients? Rising rates have definitely affected Americans in general and the real estate market in particular. However, this is a good opportunity for some investors. What we are seeing right now is that there are a lot more properties available for purchase and real estate investors who had been priced out of deals are now able to move into the market again and acquire properties at a discount. As a result, even though interest rates are higher, we are seeing borrowers coming to us with properties that they would not have been able to get their hands on even just one year ago. Interest rates are, to a degree, making this market a little more of a buyers’ market and are presenting opportunities to investors which we haven’t seen in a long time. I have seen in the news that many banks are taking a really long time to close on a deal. How long does it take to close a loan at Bavex? At Bavex, we simply do not have to deal with the things that banks have to deal with. We do not need your W-2s or your tax returns. Once we receive a full file [title work, appraisal, inspection, etc.], we often close extremely quickly. In fact, we sometimes close in less than 24 hours. In one of my favorite success stories, a borrower-investor who, today, has probably successfully invested in almost every real estate sector and almost always with our participation on the lending side, relied on our ability to close fast. This borrower came to us at about 3:00 p.m. on a Tuesday, and he had to close the deal by Wednesday. His lender had just pulled out the afternoon before closing. He expected to lose the deal — and six figures in earnest money — when he came to Bavex to see what we could do. We looked at the deal and agreed that it was a good one, and we did not want him to lose the deal or his deposit. By the end of business next day, we had helped him close that deal. That is not even the end of the story. Within 12 months of getting the bridge loan from us, he refinanced the property (it was two duplexes in Philadelphia) into a 30-year rental loan and started another project — borrowing from us, of course. Since that first project, we have done a few dozen projects with that borrower. In fact, we are closing another deal with him tomorrow on a ground-up construction deal for a four-unit property in Philadelphia. Since then, he has taken advantage of every single product we offer in his real estate investing strategies. That must make you really proud. We are definitely proud to be a part of saving the deal for him and of developing a long-term relationship through this process. We are always there for our investors. It is our goal to get our borrowers to the “next step,” whatever that may be, when they come to us for lending services. Sometimes we are helping investors go from doing a dozen projects a year to doing two or three times that, while other times we are helping people go from doing one project, maybe even their first project, to doing multiple projects, generating real wealth, and sometimes creating millionaires on our watch. That is a huge point of pride for me and for my entire team. Through this process we are creating long-lasting relationships, where our investors turn to us again and again,
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