Loan proceeds were used to pay off an existing 2nd TD Note

A recent private money closing by Max Stone in Los Angeles underscores the value of flexible lending solutions for borrowers navigating complex real estate and debt situations. In this transaction, a $535,000 private money loan was funded in the second trust deed (2nd TD) position at a 65.61% loan-to-value ratio, offering both strong yield potential and meaningful equity protection.

This type of refinance-and-cash-out structure is a common use case for private capital, especially when borrowers need to replace a maturing loan, improve terms, or consolidate a prior second-position obligation. By paying off the existing junior lien, the transaction also helped simplify the borrower’s debt stack and position the property more cleanly for future financing or a longer-term exit strategy.

Second-position lending requires careful underwriting and a disciplined approach to leverage. With the loan structured below 66% LTV, the deal maintained a responsible equity cushion while still meeting the borrower’s objectives. In a market like Los Angeles where property values can vary significantly by neighborhood maintaining conservative leverage is especially important.