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kevint
126 Posts |
 Posted - 02/20/2006 : 06:50:26 AM
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Who has had dealings with Kennedy Funding in the past ?
Would like some input - can these guys fund as promised ? |
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mwgreco
1212 Posts |
Posted - 02/20/2006 : 06:53:30 AM
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| Very rarely do they fund. They live off up front fees that they collect for their due dilligence.. |
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kevint
126 Posts |
Posted - 02/20/2006 : 06:59:56 AM
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| Good to hear - would like to hear from others. |
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heatherham
12 Posts |
Posted - 02/20/2006 : 09:34:29 AM
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We have had poor performance from Kennedy. They use bait-switch techniques with large up front fees. They are hard sellers, too, so watch out for promises on the front. Get everything in writing, and don't pay any up front fees until you get a solid, fully executed term sheet that has a reasonable exit. We can assist you with any lending that Kennedy does. We are not a large shop, but we produce results.
Heather Hamilton
First Choice Strategies, Inc.
801-763-7717 |
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wallys46011
58 Posts |
Posted - 02/20/2006 : 10:13:35 AM
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WHATCH OUT.
They are great at collecting fees. Enough said. |
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Secret
3080 Posts |
Posted - 02/20/2006 : 10:32:09 AM
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quote:
Originally posted by kevint
Who has had dealings with Kennedy Funding in the past -
Would like some input - can these guys fund or are they just hot air and promises ?
They are not amateurs, but they don't tolerate doing business with beginners either. They have been doing commercial transactions for at least 25 years that I can remember; they're for real.  |
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kevint
126 Posts |
Posted - 02/21/2006 : 1:35:17 PM
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This was not meant to be a flame. There is also no reason why I should check out the references that you provide - why would you provide me a reference that is negative. Why would you or anybody willingly disclose bad press. Uninterested third party references are always the most informative. You know this as well as anybody.
I will check out references based upon an open forum, anybody that has had dealings with Kennedy in the past, either good or bad. And as you can see, this is the original thread. This is an open forum where those that have done with Kennedy can respond freely, and without recourse. I am looking for HONEST responses, not your competition flaming you. And as you can see, up to this point, not a single lender (that I am aware of) has posted. And if we are to do any business either now or in the future refferences will be checked out in open forum and verified. If Kennedy can do what they advertise then this will come out, and would be good press for you.
However, as you can see, not everyone that has responded so far has responded negatively. This is what I am looking for. Everybody in this business will have good and bad press.
I am not interested in how many closings you had last year or over the past 20 years, nor am I interested on how much you have on your books. Obviously you have closed loans, so have I, so what.
What I am interested in is their experiences with Kennedy and how they felt about their dealings with Kennedy. Good or bad.
Now lets talk about commitment fees. You stated in your reply that “And no one ever pays a penny to us without a "solid, fully executed term sheet"”. CRAP !! You wanted and received a $10,000 up front fee before you would provide boiler plate term sheet. (still waiting for this to be refunded). Then according you your boiler plate response, you wanted another large fee 3% paid in advance either held in escrow or made out to Kennedy Funding, before you would provide a solid commitment-term sheet. These fees were requested even before any of the project documents were fully reviewed. These fees were only adjusted downwards to 1.5% on an addendum. In speaking with Kennedy you guys were unable to move forward without this fee of over $300,000 be placed in escrow. This fee was supposedly refundable if funding was not consummated. We never got to that far as the client thought this was absurd, to deposit that amount of cash, refundable or not, in an escrow account for 7 days. However, that said, I understand the need for these fees however unreasonable.
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That One Guy
28 Posts |
Posted - 02/21/2006 : 1:37:05 PM
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LAST CHANCE FUNDING OPTION. Don't even bother with an inquiry if ANY of the following conditions exist in your scenario:
1. Your borrower is intelligent enough to shop around.
2. Your borrower doesn't have liquid cash (3%) to pay in upfront fees, in return for a loosly crafted draft term letter, leaving plenty of opportunities for Kennedy to exit the room quietly with the cash.
3. You can afford to lose your client with a transaction gone bad.
Obvioulsy they close some loans. Just as obvious, though, is the observation that upfront fees on "loans gone south" is a profit center as well. (That also seems to be the general consensus in this thread.)
There are lenders out there who have the capacity, move with appropriate velocity, and don't need upfront money to grease the wheels. So there you are, enough said. |
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Secret
3080 Posts |
Posted - 02/21/2006 : 2:34:05 PM
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| kevint, as I read your latest remark it SCREAMS you don't understand commercial lending. When you do, I promise you'll laugh at your remarks about upfront fees, commitments, etc. The universe places like Kennedy travel in, is nothing like residential whatsoever. |
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That One Guy
28 Posts |
Posted - 02/21/2006 : 2:50:19 PM
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Terrence, yes we brokered this deal together. You are right in the statement that we chose you, you didn't choose us. My bad. We won't be bringing any more clients in your direction, unless I need a loan secured by art.
As far as hard money lenders go, with a little better research on my part - again, my bad, and if we had the time, we would have gone somewhere else. Our problem with you came from the fact that we put our client on the phone with one of your CEO's, to solidify the deal's details, and it became QUICKLY apparent to the client, the CEO of HIS company, from whom you were asking $600,000, that nobody there had even bothered to look at the project documentation, all of which you had had in your office for more than two weeks, even though we were supposed to be about 5-7 days from closing. That's a problem. It doesn't give a client an warm fuzzy feeling. That's when I knew we were shopping in the wrong store. All you guys would focus on was the money you wanted up front, and were unwilling to even look at the document package that was sent to you before you got those fees paid.
As I stated, with more time, I would have found a deal with the same or better terms, with no upfront money, which is what was found for them. It closed yesterday.
Your statement that hard money is hard money all over the world is not true. Given enough time, I will always be able to find a lender that offers to do a loan without receiving $10,000 for the privelege of starting the process and 3 more points for an executed commitment letter. Apparently, that $10,000 didn't include enough money to make you guys bother to even look at the project documents. If you had, you would have jumped all over this deal with both feet, as the other lender did. It's just that simple.
So there we are - I'm finished with this rant, and I've moved on - I have other work to do, and I won't be calling NJ anytime soon. Have a swell day. |
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kevint
126 Posts |
Posted - 02/21/2006 : 3:12:08 PM
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Secret,
Agreed, I am green to commercial lending- I have only been doing commercial deals for a couple of years now, and am learning as I go.
That said, client in question was able to obtain other funding in 4 days, with no up front fee's - zippo / nadda / nothing.
So I know there are commercial lenders, hard money lenders in fact that provide this type of service, Kennedy is just not one of them, and that is ok.
During the past year I have done commercial deals with no up front fee's.
Pertaining to the deal in question, it was not the terms, rate or closing fee's in question. It as up front fee's required to obtain the commitment. The client ended up closing on something with worse terms, higher rates, and higher fees. First to the dance won out.
Terrance stated that they do not require any up front fee's to obtain commitment, this is not true. Refundable or not - they require fee's up front. And I also understand that that is the way that many lenders do business, that is all fine and good. But there are those lenders our there that don't require these fee's. And as time goes on I will align myself with these types of lenders. Not to say that there may be a case that would require someone like Kennedy to provide funding, I am sure there will be.
The purpose of this thread was to help me to be able to deal with this client, and ensure him that Kennedy was for real, and that he had no reason to fear that his requried up front fee's were going to be used to obtain funding.
I am like everyone else here, just trying to make it all work, and trying to find the pieces that work together.
Therefore, that being said, I suppose that you have good things to say about Kennedy - and that is good to hear because the time may come in the future that I may have a deal that fits Kennedy's guidelines, and everyone can come out smiling. This deal in question, did not, and that is why there are multiple lending sources, as should be.
I am only upset at myself for not recognizing the needs/desires of the client. This is my failing, as if I had fully understood this, I could have taken this deal somewhere else to get funded instead of wasting energy and time trying to fit it in a product that does fit Kennedy's funding guidelines. I only have myself to blame. Lesson Learned.
However, Terrance, as to your comment that "no one ever pays a penny to us without a "solid, fully executed term sheet"" we know this not to be the case. As you also responded that there is currently $10,000 held by Kennedy, sent to you by our client in good faith. Refundable or not, Kennedy do require pennies, many pennies, sent to them without said "commitment letter". And Kennedy requested more pennies from the client before said "commitment letter" would be completed.
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That One Guy
28 Posts |
Posted - 02/21/2006 : 4:06:12 PM
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Actually, Terrence, due to scheduling issues, the signing is set for Thursday at this point. No lies.
:)
First to the table won the battle. But thanks.
*resuming my -lurk- status here.* |
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kevint
126 Posts |
Posted - 02/21/2006 : 4:54:04 PM
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Terry,
In response - I guess what I was trying to say - maybe poorly, was in response to your comment that Kennedy does not charge any fee's - not one cent (your statement) until a commitment has been drawn up. Not to be angry, just trying to understand here. My client DID pay $10,000 to Kennedy - was required to pay $10,000, this fee was requested by Kennedy after the letter of interest but long before any loan commitment was even drawn up. What the client got in return for his $10,000 was a boiler plate commitment. I understand the negotiations that were needed to take place at that time, part of these negotiations were up from "retainer" fee's if you will. Gregg stated verbally to me that he would not proceed any further without securing at a minimum of 1.5% to be held in escrow to secure and continue to the next step, loan commitment. Your statement that no fees are paid to Kennedy without a firm commitment are misleading. Kennedy does require up front fee's, and I am good with all that in general. But this client was not, and it became very apparent to me later on in the game but at that point it was too late to recover, deal lost, lesson learned.
If we could have proceeded without any more up front commitment fee's we might just be sitting across the table from each other at a closing.
Our client is for real, and real serious when he stated that if we could get the deal without any MORE upfront fee's, that he would sign the closing documents. This is not our clients first rodeo, he is an experienced developer, he needed a quick band-aid fix to get this project started. With other bids lining up behind him, he could not wait for "as many as 20 drafts", he needed the closing.
You stated he did not fit your criteria - what criteria is that ? He was asking for an initial draw of 6.1 mill, based on a 11 mill as is value, and subsequent draws totaling 23mill as the project progressed keeping your LTV easily less than the 65% LTV required. Equity based lending is that what I read ?. This project fit nearly perfectly in your guidelines.
We just were not able to get it moving fast enough, he has obtained a firm commitment from and is closing with a different lender/broker - not us as you eluded to in your comment to Brad. We did not get paid on this deal either.
Moving on - lets see what we can do with some other projects I have in the works.
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loandog1
703 Posts |
Posted - 02/21/2006 : 6:00:48 PM
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| By the way Secret, thanks for the post. I know you neither endorse us nor condem us, but your non-biased input is much appreciated. |
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kevint
126 Posts |
Posted - 02/21/2006 : 9:31:49 PM
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quote:
Originally posted by loandog1
No problem Kevin, sorry you lost the deal as a result. But please let me clarify once again...
In the mean time, I wish you much success and look forward to the next opportunity to work with you.
Thank you for your input. And in the future who knows if we will an opportunity to work together at least I will have a better understanding of how Kennedy works and will be able use that information to the advantage of all. |
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laila
249 Posts |
Posted - 02/22/2006 : 03:59:11 AM
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quote:
dang007
ATTENTION:
Everyone here should know that Kennedy Funding is
currently under investigation by the SEC and FBI for
frauding their client out of hundreds of millions
of dollars.
Watch Out People !!
Dang, what's your source of information?
Can you please cite a published source for this?
I looked and found nothing. Sounds like slander to me. |
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kevint
126 Posts |
Posted - 02/22/2006 : 07:03:08 AM
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quote:
Originally posted by dang007
ATTENTION:
Everyone here should know that Kennedy Funding is
currently under investigation by the SEC........
Dan Garfinkel
Dan -
Don't slander - please post your sources. If you are a competitor, I dont want to hear from you. I want to hear from past and present people who have had dealings with Kennedy, good and bad. This is not, a thread to slander or degrade anybody, just a source of information.
Thank you |
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wallys46011
58 Posts |
Posted - 02/22/2006 : 11:48:36 AM
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Terrance,
I had a client in Indiana whom was assured by Kennedy funding that they would not lose the funds they forwarded to you in their transaction. The loan drug out forever. He would like to know where his $70,000 dollars are. It really seems odd that Kennedy took his money and didn't come through but a bank did the deal at prime rate. |
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wallys46011
58 Posts |
Posted - 02/22/2006 : 12:49:42 PM
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Terrance,
I sent you the information on the deal in question. While I appreciate your interest. I am hoping that a good portion of the funds my client sent you will be refunded. That would certainly leave a better taste in my mind as to Kennedy's business practices. |
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loandog1
703 Posts |
Posted - 02/23/2006 : 07:31:41 AM
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quote:
Originally posted by wallys46011
Terrance,
I sent you the information on the deal in question. While I appreciate your interest. I am hoping that a good portion of the funds my client sent you will be refunded. That would certainly leave a better taste in my mind as to Kennedy's business practices.
Hello Wally, here is the information you requested;
I will leave out the names involved for privacy reasons, if you would like to call me I will be more than happy to go into detail. You were not the broker on this deal, correct? There is another brokers name on the file.
In any case, the client accepted our offer and submitted $58,000 for our commitment fee. We completed our due diligence and the value came back higher than it was stated. They requested more money and we agreed.
We have everything, transcripts, appraisal, title work, etc. in the file and made an offer which they accepted and we were moving to close. Then they stopped calling and never returned our calls. This was back in May of 2003. They never closed on our offer, we had arranged the money and completed our due diligence, of course they never got their money back. That is one of the primary functions of our commitment fee. To protect us in the event the borrower decides not to close with us.
According to you they closed with another lender, which explains why we never heard back from them. They never even requested any money back from us, so I'm not sure what you are referring to when you say we promised them a portion of their fees back.
In our commitment letter it is plainly written, if the borrower is unable to perform on their end of the commitment or decides to close with another letter once the commitment is executed their money becomes earned. If we decide not to offer a loan based on our commitment we will refund 100% of all monies paid to us.
It is real simple Wally, these guys had us get all dressed up for the prom, and then never showed up. That is why they never received a refund from us. But honestly, it appears in the file that they were fully aware of this since we have several transcripts from them and not a single one ever made mention of a request for a refund.
Again, I could give you names and numbers of the brokers involved if you would like to call me directly and you could check in with them. We had an offer in place that the borrower accepted, I have no idea why it didn't close other than your statement that they closed with another lender... |
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amflores
413 Posts |
Posted - 02/23/2006 : 09:02:03 AM
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Kevin,
Who are you guys currently using to fund your loan? |
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kevint
126 Posts |
Posted - 02/23/2006 : 09:21:29 AM
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We lost the loan chatted about here -
Email me - we can chat. |
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