In this episode, I interview a very interesting and really smart guy in the lending space. His name is Sasha Favelukis, and he shared a lot of great information with us regarding hard money. This interview was extremely informative!
Alexander (Sasha) Favelukis has been involved in the mortgage industry since 2002. He started as a wholesaler, selling loans packaged to the secondary market. With his experience and wealth of knowledge of the inner workings of the banking industry, he decided to move into the retail aspect of lending, and began working as a loan officer in 2003.
In 2005, Sasha Favelukis and Alex Pellegrino started a mortgage and real estate company in La Mesa, CA. They immediately grew to 19 employees, partnered up with a large lender in Los Angeles, and became one of the first companies to offer non-resident alien loans to people with ITIN numbers. In January of 2007, they decided to exit the conventional lending industry because they saw the end of an era coming. Due to the fact that they were funding loans for some of the most aggressive lenders, they were able to see the contraction of the lending market before most did.
In July of 2007, Sasha moved to San Francisco to pursue an opportunity to work in the private money space. From 2007 until 2010 Sasha was able to fund $70 million in loans and put $50 million of investor capital to work. After studying the industry of private money, or hard money as it is called, Sasha decided to move back to San Diego because he felt that the market had bottomed out and it was a good time to start lending there.
His private LLC was established in 2010, has funded over 120 hard money loans in San Diego County, and bought a multitude of investment properties that give a constant return of 10%.
In 2012, Sasha joined as a partner with Sequoian Investments Inc, which engages in private money finance. In 2013, Sequoian funded over $20 mm in short-term loans for property rehabbers in the San Diego area. They are now starting to expand to other markets in other states. They plan to be up and running across the US by mid-May.
Sasha essentially jumped right out of school and into the real estate investing world. He believed that he was able to position himself very well during the real estate crash of 2008/2009. He was in an area of California that was much less affected (San Francisco Bay), and he changed his model so that he was able to weather the storm. That area of California remained very stable and prices did not dip dramatically. Because he isolated himself in an area that remained stable and largely unaffected, he was able to continue his real estate business while everyone else faced enormous challenges in the industry.
Sasha was lending money and finding deals for real estate investors. He and some partners were trying to buy rentals and kept getting outbid by house flippers. Eventually, Sasha just asked if he could fund some of their deals. From that point on, he started working with investors and funding flips.
Sasha’s advice for finding a good moneylender your area is simply to use word-of-mouth and personal recommendations. Because it’s very hard to know the good, hard moneylenders from the bad, hard moneylenders, your best chance is to talk to people you know and trust and get their recommendation.
sequ.com– Sasha’s website for Sequoian Investments- his hard money lending company
The number you can reach him at is: 855-390-5626