weather icon Clear

Real estate investing is not a one-trick pony game

Updated June 9, 2021 - 9:45 am

Ignite Funding, a hard money lender, experienced zero defaults in 2020, a pitfall that many lenders and real estate developers were unable to avoid due to the global pandemic. Ignite Funding has not taken this achievement lightly, knowing that many in the lending industry were not left unscathed.

Ignite Funding attributes this success to their lending philosophies and the various steps they take to mitigate the company’s overall exposure to risk.

Risk mitigation is exceedingly important as Ignite Funding’s sole operation is to provide thousands of investors the opportunity to participate in real estate investments through trust deeds.

The ‘one-size-does-not-fit-it-all’ philosophy

Ignite Funding does not abide by a “one-size-fits-all” approach to lending. This flexibility allows Ignite Funding to work with proven developers with varying expertise and product type.

In other words, Ignite Funding does not put all their eggs in one basket by only lending on one type of real estate developed in one specific region. This allows Ignite Funding to stay ahead of real estate trends and maintain a diverse portfolio that has been essential during market fluctuations.

“We understand the importance of not limiting our financing and being nimble in an ever-changing real estate market,” affirmed Pat Vassar, the director of underwriting at Ignite Funding.

“Our success is derived from identifying borrowers that recognize a real estate product need and delivering it to the market at an opportune time. This includes the borrower having the ability to re-create themselves and evolve with the market as needed.”

Ignite Funding typically lends in the Western U.S. but is open to working with bankable borrowers in non-judicial states with a long history in the region and reliable track record. Ignite Funding primarily lends on the acquisition and horizontal and vertical development/rehabilitation on residential and commercial projects.

For example, investors have the ability to invest in projects ranging from the Huntridge Theater rehabilitation in downtown Las Vegas to apartment conversions in Sierra Vista in Arizona to converting malls into lifestyle centers on the outskirts of Boise, Idaho.

This level of diversification is how investors are able to optimize and mitigate risk within their individual real estate investment portfolios.

The ‘loan-to-own’ philosophy

While Ignite Funding leaves the door open to new opportunities, that does not mean they agree to fund every project that walks in.

“Only about 10 percent of the loans that come through the pipeline get approved for funding,” Vassar said. “This applies not only to borrowers that may be new to Ignite Funding but repeat borrowers as well.”

This is because of Ignite Funding’s “loan-to-own” philosophy, which means that while the underwriting process includes a thorough review of the borrower to ensure that they are a financially sound company, the main focus is on the respective property and the borrower’s intended exit strategy.

“Even the best borrower is only good until they are not. At the end of the day, your main source of recourse is going to be the property you take back through foreclosure and if you are able to execute the sale of the property as it was intended,” Vassar said.

2020 performance highlights

Ignite Funding prides itself in its ability to continuously support the success of its borrowers, and in turn, provide quality investments to its investors.

At the end of December 2020, Ignite Funding had $175 million in loans under management and paid out $14.3 million in interest income to investors.

To date, Ignite Funding has facilitated 1,376 real estate investments funded with $907 million in investor capital, providing 51 borrowers in 16 states with the ability to acquire and develop more than 12,000 acres of land, 8,100 residential lots and 3.5 million square feet of commercial space.

Go to ignitefunding.com to review Ignite Funding’s annual performance record since their inception in 2011.

Don't miss the big stories. Like us on Facebook.
Homebuilders midyear report shows sales increase

Lennar led Las Vegas homebuilders in net sales during the first half of 2024 as seven of the top 10 builders saw double-digit increases compared to 2023.

Summerlin showcases Toll Brothers home styles

Toll Brothers, one of 10 national homebuilders in the master-planned community of Summerlin, currently offers three unique home styles in the community.

Summerlin Fourth of July parade draws thousands

Residents of the Las Vegas Valley turned out by the tens of thousands on July 4 to witness the 30th annual Summerlin Council Patriotic Parade — Southern Nevada’s largest Independence Day parade, presented by title sponsor, Howard Hughes, developer of the Summerlin master-planned community.

Builders post strong May home sales numbers

Las Vegas builders posted their strongest May in home sales since prior to the pandemic and are on track to their second best year since 2020.

Battle for Vegas returns to Las Vegas Ballpark

This year, Battle For Vegas, hosted by Vegas Golden Knight (VGK) center Jack Eichel, returns to Las Vegas Ballpark at Downtown Summerlin on July 13.

Summerlin Fourth of July parade to mark 30th year

The Las Vegas Valley is invited to the master-planned community of Summerlin on July 4 to celebrate Independence Day at the 30th Annual Summerlin Council Patriotic Parade — Southern Nevada’s largest and most colorful Fourth of July parade.

Tri Pointe offers Summerlin town homes

Vertex by Tri Pointe Homes in Summerlin offers convenient and low-maintenance town home living with the added benefit of a private backyard and patio more typical of a single-family home.

April sets record for 2024 new home sales

The Las Vegas new-home market recorded its best month of the year for the number of net sales per week as buyers continue to purchase, especially attached products, despite elevated mortgage rates.

Summerlin offers age-qualified communities

Heritage by Lennar, is located in the village of Stonebridge and has three remaining single-family detached homes available that range from 1,232 square feet to 1,422 square feet, priced from the $500,000s.