JCAP Private Lending is a direct hard money lender, funding most of its business in Southern California. CEO Bob Eakin started his lending career as a loan officer in the late ’80s and was named one of the Top 50 Loan Originators in the USA before progressing into an ownership role.

JCAP Private Lending is known for its ability to close quickly. “We are not the cheapest, but we are the fastest,” Eakin says.

Originate Report (OR): Tell us about the first deal that you ever closed.
Bob: In 1988, I closed a construction loan on a spec house in Anaheim Hills, Calif. A builder thought that if they built mansions near Anaheim Stadium, the baseball players from the Angels would be standing in line to buy them. It was a great idea, but they had no idea how to get the money…neither did I. However, my friend (the builder’s CFO) said that if I could find the bank that would do the loan, he would package it for me. I opened the yellow pages and started calling banks that morning: “Do you do construction loans? Do you know who does?” It took all day, but at the end of that day I found a small community bank that ultimately funded the loan. My commission was $10,000…and a business was born!

OR: What makes JCAP Private Lending different than other hard money lenders?
Bob: We are fast. As a former top producer, I understand how crucial it is to close quickly. We have closed loans “next day.” Usually, we are ready and waiting for everyone else so that we can close.

OR: Is your structure typical of other lenders?
Bob: No, we are not a fund. JCAP Private Lending works on a fractionalized model. Our investors take either a portioned or whole interest in the promissory note. Then their beneficial interest is secured right on the deed of trust. I chose this model so that there would be no chance of impropriety with funds. I believe it is the safest model for the investor.

OR: Do you ever invest personally in the loans that you originate?
Bob: I have a position in most of the loans that we produce. Our loans are a sound investment, and I want to be in them too. I am the chief underwriter at JCAP Private Lending. I underwrite like an investor, because I am an investor. If I am not in a loan, it is usually because another investor talks me out of my position. (The people pleaser in me pushes me out of my investment for the benefit of another from time to time. Rats!)

OR: How was 2017 for you?
Bob: Record breaking!

OR: Any challenges in 2017?
Bob: After the re-tool from the 2008 meltdown and our recovery through 2013, my goal with JCAP Private Lending was to be a boutique hard money company. We did fine through the meltdown. However, I thought this new season would look a lot like a few high-yield loans, learning to golf, and lots of travel. Well, a few loans turned into lots of loans. I stink at golf, but I did squeeze in some traveling. The biggest challenge became money. Would we have enough ready capital to close all of the loans that we wanted to fund? 2017 became the year of fundraising.

I had heard the stories about lenders delaying closings because of running out of money. I really did not want to be one of those companies. So I hit the road: conventions, lunches, coffees, and lots of stinky golf! As I reflect back on 2017, we made it. No delayed closings due to money. In fact, we now have an over-supply.

OR: What is your greatest challenge for 2018?
Bob: Underwriting and deal flow. A friend of mine warned me that when money is not the issue, the trap is to make bad decisions to get the money on the street. We have already seen some crappy deals in 2018. Our challenge is going to be to avoid deals that we should not be in…We are lenders, not property owners. I want to lend people money that can and will make their payments and pay back their loans. Our goal is not to acquire property through lending.

Deal flow is the other big challenge. If we see more loans, we will write more loans. JCAP Private Lending is an old-school, high touch lender. We are attacking the deal flow challenge by increasing the sales staff. We are a people-centric company. The goal is to have everyone know everyone — people working with people to safely close more loans quickly.

OR: Do you have any niches?
Bob: Our focus is firsts and seconds, owner and non-owner residential to $5 million.