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Avatar Financial Group Raises $50 Million in Venture Capital
In a bone-dry financial market, two Seattle businessmen raise $50 million dollars and roar onto the nationwide non-conforming commercial lending market. Their flexible lending criteria and two-week ready-to fund timing on real-estate collateralized loans are greasing the wheels of commerce.
(PRWEB) August 12, 2004 -- When companies who scrape together $2 million in financing are touted as success stories, two men in Seattle raised $50,000,000 ($20,000,000 in equity capital and an additional financing line of $30,000,000) in the toughest economic climate in a quarter of a century and roared onto the commercial lending market as Avatar Financial Group.
How did they do that? The clue lies in the kind of loans Avatar Financial Group makes. At a time when venture and working capital has dried up and banks have tightened their reigns, Avatar Financial Group, as a private lender, has more leeway to fund than their banker counterparts.
Businesses suffering from a slow economy are caught in the bind of smaller cash flow and fewer sources for working capital. As soon as the cash flow tightens, they no longer conform to bank requirements. When it comes to non-conforming real estate collateralized loans, Avatar Financial Group is able to get the wheels of commerce turning again, funding both commercial and residential properties. Non-conforming (aqua 'hard money) loans are essentially short term (1-3 years) loans based on real estate equity that do not meet traditional bank requirements.
Institutional funding sets Avatar aside from many non-conforming or hard money lenders. Most, including the local lender where Zevenbergen served as president and Hazelrigg as senior loan officer before starting their own company, are funded by private investors. An investor-funded lender must market for both investors and borrowers, matching the two when a loan is requested.
Being institutionally funded, Avatar enjoys the significant advantage of having the money already available, yielding lower cost loans that close faster. In any given month, Avatar has approximately $40 - 50 million available for funding. Their documented ready-to-fund timeframe is two weeks.
The loans Avatar funds enable people to purchase property or avoid the loss of property. Avatar Financial Group can review, underwrite, approve, and fund a loan in 2 weeks or less. The loans are based on the equity value of real estate, with Avatar taking the first lien position on the property. The maximum loan Avatar provides is equal to or less than 65% of the value of the property (65%LTV). In the event that a property must be taken over and sold off by Avatar, the margin between the value of the property and the size of the loan protects Avatars investment. This reduces the risk factor for Avatar and provides an additional clue to Avatars success in raising such a substantial amount of capital.
The founders, Jerry Zevenbergen, CEO and TR Hazelrigg, President bring substantial experience and respected standing in the lending community to the company. Zevenbergen served for several years as president and CEO, and Hazelrigg as VP of a nationwide investor-funded lender. These days, they can be found all over the nation, personally inspecting property in order to approve commercial real estate loans.
Based in Seattle, Washington, Avatar Financial Group has already funded more than $50,000,000 in commercial and residential real estate bridge loans. Information about the company and the projects they fund can be found at http://www.avatarfinancial.com or by calling the company at 888-886-0097.
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