Frequently Asked Questions

About RCN Capital

What are the standard terms at RCN Capital?

RCN Capital’s terms vary by loan program. Here is a basic breakdown of RCN’s most popular programs:

Short-Term Bridge

Term: 12 Month & 18 Month Loans
Loan Amount: $50k – $10M
Minimum Property Value:
$75k for 1-4 Family Properties
$50k per unit for 5+ Unit Multis
Rates: Starting at 10.24%
LTV for Purchase: Up to 75% of the As-Is Value
LTV for Refinance: Up to 65% of the As-Is Value
LTV for Cash-Out: Up to 60% of the As-Is Value
Property Types: Residential 1-4 Units; Condos; Townhomes; 5+ Unit Apartments; Mixed-Use Properties
Occupancy: Non-Owner Occupied
Minimum FICO: 620

After Repair Value (ARV) Loan Program

Term: 12 Months
Loan Amount: $50k – $7.5M
Minimum Property Value: $50k
Rates: Starting at 10.24%
LTV: Up to 70% of After Repair Value
LTC (Loan-to-Cost): Up to 85% of Purchase Price, Up to 100% of Rehab Costs
FICO: 620 Minimum Credit Score
Property Types: Residential 1-4 Units; Condos; Townhomes; 5+ Unit Apartments; Mixed-Use Properties
Occupancy: Non-Owner Occupied
Termination Fee: 1% After Month 9
No Pre-Pay Penalty
Experience Not Required but Does Affect Pricing & Leverage

Long-Term Rental Loan Program

Term: 30 Years
Loan Amount: $55k to $2M
Minimum Property Value: $100k
Rates: Starting at 6.99%
LTV for Purchase: The Lesser of up to 80% of As-Is Value or up to 80% Loan-to-Cost
LTV for Refinance: Up to 80%
LTV for Cash-Out: Up to 75%
Property Types: Residential 1-4 Units; Condos; Townhomes; Planned Unit Development (PUD)
Pre-Pay Penalty: Prepays Adjustable Up to 5 Years
Minimum FICO: 680

Long-Term Rental Multi-Family Loan Program

Term: 30 Years
Loan Amount: $100k to $2M
Rates: Starting at 7.15%
LTV for Purchase: The Lesser of up to 67.5% of As-Is Value or up to 67.5% Loan-to-Cost
LTV for Refinance: Up to 67.5%
LTV for Cash-Out: Up to 65%
Property Types: Non-Owner Occupied Multi-Family Real Estate; 5+ Unit Apartments; Maximum 9 Units
Pre-Pay Penalty: Prepays Adjustable Up to 5 Years
Minimum FICO: 680

New Construction Loan Program

Term: 12 – 24 Months
Loan Amount: $100k to $2M
Rates: Starting at 10.99%
LTV for Purchase: Up to 80% of Initial Advance; Up to 90% Total Loan-to-Cost
LTV for Refinance: Up to 75% of Initial Advance; up to 90% Total Loan-to-Cost
Property Types: Non-Owner Occupied Single-Family Properties; Condos; Townhomes
Pre-Pay Penalty: N/A
Minimum FICO: 650

RCN Capital Contact Information

Who do I contact for general inquiries at RCN Capital?

If you are a current RCN Capital client, please contact your loan officer directly with any questions.

If you are a new client, you can contact RCN Capital by phone through our general number: 860-432-5858 or by email: Info@RCNCapital.com.

Who do I contact for servicing inquiries?

Elite Commercial Servicing is RCN Capital’s loan servicing provider.

For any loan servicing inquiries, please contact Elite Commercial Servicing:

P \ (877) 417-1331

For Draw Requests: Draws@elitecommercialservicing.com
For Pay Off Letters: Demands@elitecommercialservicing.com
For Billing Statements & General Questions: Servicing@elitecommercialservicing.com
For Modifications & Past Due Accounts: Collections@elitecommercialservicing.com

RCN Capital's Loan Programs

What are the standard terms at RCN Capital?

RCN Capital’s terms vary by loan program. Here is a basic breakdown of RCN’s most popular programs:

Short-Term Bridge

Term: 12 Month & 18 Month Loans
Loan Amount: $50k – $10M
Minimum Property Value:
$75k for 1-4 Family Properties
$50k per unit for 5+ Unit Multis
Rates: Starting at 10.24%
LTV for Purchase: Up to 75% of the As-Is Value
LTV for Refinance: Up to 65% of the As-Is Value
LTV for Cash-Out: Up to 60% of the As-Is Value
Property Types: Residential 1-4 Units; Condos; Townhomes; 5+ Unit Apartments; Mixed-Use Properties
Occupancy: Non-Owner Occupied
Minimum FICO: 620

After Repair Value (ARV) Loan Program

Term: 12 Months
Loan Amount: $50k – $7.5M
Minimum Property Value: $50k
Rates: Starting at 10.24%
LTV: Up to 70% of After Repair Value
LTC (Loan-to-Cost): Up to 85% of Purchase Price, Up to 100% of Rehab Costs
FICO: 620 Minimum Credit Score
Property Types: Residential 1-4 Units; Condos; Townhomes; 5+ Unit Apartments; Mixed-Use Properties
Occupancy: Non-Owner Occupied
Termination Fee: 1% After Month 9
No Pre-Pay Penalty
Experience Not Required but Does Affect Pricing & Leverage

Long-Term Rental Loan Program

Term: 30 Years
Loan Amount: $55k to $2M
Minimum Property Value: $100k
Rates: Starting at 6.99%
LTV for Purchase: The Lesser of up to 80% of As-Is Value or up to 80% Loan-to-Cost
LTV for Refinance: Up to 80%
LTV for Cash-Out: Up to 75%
Property Types: Residential 1-4 Units; Condos; Townhomes; Planned Unit Development (PUD)
Pre-Pay Penalty: Prepays Adjustable Up to 5 Years
Minimum FICO: 680

Long-Term Rental Multi-Family Loan Program

Term: 30 Years
Loan Amount: $100k to $2M
Rates: Starting at 7.15%
LTV for Purchase: The Lesser of up to 67.5% of As-Is Value or up to 67.5% Loan-to-Cost
LTV for Refinance: Up to 67.5%
LTV for Cash-Out: Up to 65%
Property Types: Non-Owner Occupied Multi-Family Real Estate; 5+ Unit Apartments; Maximum 9 Units
Pre-Pay Penalty: Prepays Adjustable Up to 5 Years
Minimum FICO: 680

New Construction Loan Program

Term: 12 – 24 Months
Loan Amount: $100k to $2M
Rates: Starting at 10.99%
LTV for Purchase: Up to 80% of Initial Advance; Up to 90% Total Loan-to-Cost
LTV for Refinance: Up to 75% of Initial Advance; up to 90% Total Loan-to-Cost
Property Types: Non-Owner Occupied Single-Family Properties; Condos; Townhomes
Pre-Pay Penalty: N/A
Minimum FICO: 650

How do you determine the loan amount?

RCN Capital is an asset-based lender and loan amounts are based on the value of the real estate asset that is being pledged as collateral. Max loan-to-value varies by loan program. Please refer to the “Loan Programs” tab of RCN’s website for more details.

What states do you lend in?

RCN Capital is able to lend to most states in the U.S. with the exception of Alaska, Nevada, North Dakota, South Dakota, and Vermont.

What type of documentation is required for the loan application?

RCN requires basic documentation to underwrite the borrower and the property. This includes an application; authorization to run a credit report and background check; copies of bank statements (proof of funds); property appraisal; copies of leases, if appropriate; renovation estimates; and documentation on the business entity.

Do you have a minimum FICO score?

RCN Capital’s bridge loans and After-Repair Value loan program have a minimum FICO requirement of 620. The Long-Term Rental loan program has a minimum FICO of 680. The New Construction loan program has a minimum FICO of 650. With all loans at RCN, the borrower’s credit score is taken into consideration when underwriting the loan. RCN reviews the individual’s history to determine if there is a repeating pattern of poor financial management or if an isolated incident affected the individual’s credit. We also look at the borrower’s credit in terms of the exit strategy. If the borrower intends to buy and hold rather than fix and flip the property, we will pay closer attention to FICO scores.

Are there any upfront fees or costs?

RCN does not charge any upfront fees during the pre-approval and approval process such as an application fee. However, the borrower is responsible for third party fees such as appraisals or project feasibility studies.

Do you charge interest on the full amount of an ARV loan?

Unlike many of our competitors, RCN only charges interest on the current outstanding balance of an ARV loan. We do not charge interest on the hold back until the funds are drawn, saving you money.

Do you have a prepayment penalty?

RCN’s 30-year Long-Term Rental loan has adjustable prepayment options up to 5 years . There are no pre-payment penalties associated with RCN’s other loan programs.

What can I use as collateral for my loan?

For our Bridge Loans, After-Repair Value loan program and Buy-to-Rent loan program, RCN will consider non-owner occupied 1-4 family & multi-family real estate, condos, townhomes, 5+ unit apartments & mixed-use properties as potential collateral. For our Long-Term Rental loan program, RCN will consider non-owner occupied 1-4 family real estate, condos, townhomes, and planned unit developments (PUDs) as collateral.

Do you fund the rehab costs?

RCN Capital offers an After Repair Value loan program for non-owner occupied 1-4 family & multi-family real estate, condos, townhomes, 5+ unit apartments, & mixed-use properties. RCN will lend up to 85% of the purchase price and up to 100% of the renovation costs, not to exceed to 67.5% of the after repair value.

What is RCN's maximum LTV (Loan-to-Value) based on ARV (After Repaired Value)?

RCN Capital is an ARV Lender. Our ARV Loan Program provides up to 85% of the purchase price with an LTV not exceeding 70% of the After Repair Value.

Can I use RCN to buy my home?

RCN Capital is a commercial lender meaning our loans are used for business purposes, rather than individual or personal interests. We do not provide funding for the purchase of any owner occupied residential properties. Our loans are strictly backed by non-owner occupied residential and commercial properties, and are issued to a business entity.

RCN Capital's Loan Process

What type of documentation is required for the loan application?

Why do hard money lender require a down payment?

Hard money loans are funded by private investors, as opposed to traditional lenders like banks or credit unions, and those investors are taking on more risk by financing this type of loan. Lenders have to assume that their borrowers will be able to pay back these loans, including interest, within the timeframe set by the loan terms. By lenders requiring a down payment, it lowers the risk for them should the loan not be repaid.

It’s important to note that every lender will have their own criteria for their loans, including how much risk they are willing to take on. To learn more, click here.

How is a fix and flip loan different from a conventional loan?

Traditional home mortgages are usually amortized over 15/30 years; while with a fix and flip loan, investors make monthly interest-only payments for a term of 6-24 months. Speed is also a critical factor, and these loans can often be approved and funded in as little as 5-10 days, while traditional bank loans can take anywhere from 45-60 days to close. Additionally, fix and flip loans can provide separate funds to cover renovation costs on top of property acquisition expenses.

Click here to learn more.

Which documents do I need to prepare when applying for a fix and flip loan?

Lenders will be evaluating your strategy when deciding to close on your deal, meaning you should aim to know your strategy inside and out to lower your risk in the market and make your deal more guaranteed. The more data you have backing up your strategic decision the better. Your after-repair value, better known as ARV, is going to be a major factor in the finalization of your deal by lenders. After estimating your repair budget and your ARV, you should present the information to lenders so they can determine the amount of capital it will take to complete your project.

Click here to learn more.

How do construction loans differ from other loan programs?

There are several different types of ground-up construction loans including construction-to-permanent, construction only, and FHA 203(k). RCN Capital's construction loans are offered in construction only and construction-to-permanent varieties, with the latter offering investors the ability to easily transition to a long-term loan.

Click here to learn more.

Which documents do I need to prepare when applying for a construction loan?

Before you apply for a construction loan, you should be able to present a detailed plan and budget estimate for the property. As there is no collateral to back the loan, your credit and construction experience will be more important in determining loan approval.

Click here to learn more.

Broker Referral Program

Do you pay referral or finder's fees?

RCN Capital will gladly compensate you for a referral that results in a closed loan, pursuant to local rules and regulations. It is up to you to determine whether you are legally able to accept a referral fee.

How do I sign up for RCN Capital's Broker Program?

If you are interested in receiving more information about RCN Capital’s Broker Program, please fill out the contact form on the “Brokers” tab on our website and you will receive RCN’s Broker Registration Package. Once you complete these forms via DocuSign, you can start referring deals immediately.

As a broker, how do I get paid?

Broker fees are disclosed upfront on the commitment letter, in a transaction specific agreement with RCN Capital and on the HUD. A check is sent directly to the broker at closing.

Industry Terms

What is a hard money loan?

Hard money loans are a specific type of asset-based loan that is typically secured by real estate. At RCN Capital, loans are backed by non-owner occupied residential real estate or small balance commercial real estate. In some cases, multiple non-owner occupied properties are cross-collateralized in order to secure the needed loan amount.

What is a commercial loan?

Commercial loans are used for business purposes, rather than individual or personal interests. At RCN Capital, we only make commercial loans that are secured by non-owner occupied residential and commercial real estate.

What is a bridge loan?

A bridge loan is typically interim alternative financing used by a business until more conventional financing is secured. The bridge loan may also be used to cover short-term cash-flow issues.

What can I use a line of credit for?

A line of credit can be used for a variety of purposes, such as the funding of construction phases, specific business purchases or addressing cash flow needs.

What are the typical costs associated with a rental property investment?

Rental property operating expenses are the essential costs associated with running and maintaining an investment home that generates rental income. These expenses are deducted from your gross rental income to arrive at your Net Operating Income (NOI). NOI is a key financial metric that helps investors understand the profitability of a property.

Generally, you can remember the costs with the PITIA acronym: Principal Loan Costs, Interest, Taxes, Insurance, and Association Fees. However, there may be additional costs associated with a rental property. To learn more, click here.

How do I calculate the return on a fix and flip investment?

Many investors find it helpful to think about the costs of their fix and flip when determining the final projected value. There are many expenses associating with flipping a property, including Acquisition Costs, Renovation Costs, Loan Holding Costs, and Operating Costs.

You can subtract these costs from your property's after repair value (ARV) to obtain your return estimate. To learn more, click here.

How can I reduce tax costs with a fix and flip investment?

With rental property investments, there are various strategies you can employ for reducing taxes or avoiding taxation altogether. Some available options for fix and flip investing include: tax deductions, 1031 exchange exemption, holding the property longer, and offsetting losses with profits. With these options, you maximize your tax benefits and minimize tax liability.

Click here to learn more.

How can I prepare to qualify for a portfolio loan?

Portfolio loans are a financing option that allow an investor to merge the mortgages of multiple properties into a single monthly payment. These loans often have lower payments achieved through a combination of interest only and ARM options. This offers lenders greater flexibility in setting their own lending standards, which can benefit borrowers who don't meet traditional loan requirements.

Some key factors in qualifying for a portfolio loan include a strong credity history, a good debt-to-income (DTI) ratio, cash reserves, and providing detailed property evaluations. To learn more, click here.