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Author Topic: How to use OPM to fund house rehabs?  (Read 18542 times)

Offline Redstar1324

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How to use OPM to fund house rehabs?
« on: September 12, 2016, 01:16:51 am »
If my first 2-3 house rehabs go well, how can I use other people's money to exponentially grow what I'm doing? I have enough for one house now, using a hard money lender. If that goes well, I will have enough for one more. I could probably do 4/year at most this way.

If I could attract $1,000,000 of investment money, I could do a lot more, assuming I could manage them all.

How should I structure the loans that I'm getting from the investors?

Currently, I take out 2 year loans at 12.9% plus the extra fees that go along with using hard money lenders.

Offline Redstar1324

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Re: How to use OPM to fund house rehabs?
« Reply #1 on: September 12, 2016, 09:25:41 pm »
Let's say I offered to borrow money as 30/5 or even 30/1 loans.

If I can't resell a house in one year, something's wrong with me or the economy crashed.

I really need to join an economics forum so I can predict when the economy will crash. I'm smart enough to figure it out.

The question becomes: where do I find these lenders. Wasn't I supposed to go to the courthouse and search records for "something" and filter out the major lending institutions and what's left are my private lenders.

Offline Gold River

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Re: How to use OPM to fund house rehabs?
« Reply #2 on: September 13, 2016, 09:36:54 pm »
Hi,

    A hard money loan is other peoples money!

A private money loan is other peoples money!

A conventional, VA or FHA loan is other peoples money!

A credit card is other peoples money!

A signature loan is other peoples money!

A HELOC is other peoples money!

A loan, line of credit or credit card is other peoples money!


                        GR

Offline Redstar1324

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Re: How to use OPM to fund house rehabs?
« Reply #3 on: September 14, 2016, 10:05:24 am »
I know. But I'm trying to do this with no money down after the first one. If I can show some wealthy people that I can rehab successfully, maybe they'd give me 30/2 loans.

I'll try Craigslist.

Offline Gold River

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Re: How to use OPM to fund house rehabs?
« Reply #4 on: September 16, 2016, 05:01:31 pm »
Hi,

    What is a 30/2 ???

Are you referring to a term loan or investment term?


              GR

Offline Redstar1324

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Re: How to use OPM to fund house rehabs?
« Reply #5 on: September 16, 2016, 05:34:27 pm »
2 year loan, amortized over 30.

Or 30 year loan with balloon due after 2.

Offline Gold River

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Re: How to use OPM to fund house rehabs?
« Reply #6 on: September 16, 2016, 06:01:23 pm »
Hi,

    No investor is going to do a fully amortized loan for 2 years! If your flipping property your going to be lucky to get a 6 to 12 month interest only loan at 9% or 10% plus 3 to 5 points. Investors want their money back ASAP to reinvest.

A short term rehab loan will probable be 6 months with possible extension terms!


              GR

Offline Redstar1324

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Re: How to use OPM to fund house rehabs?
« Reply #7 on: September 16, 2016, 07:53:16 pm »
My dad might.

The hard money lender I'm planning to use is interest-only for 2 years.

Offline All-Ears

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Re: How to use OPM to fund house rehabs?
« Reply #8 on: September 18, 2016, 10:16:12 pm »

If I could attract $1,000,000 of investment money, I could do a lot more, assuming I could manage them all.


How many hard money lenders are there that are going to lend a somewhat new investor that kind of dough?

I am new myself. It seems like they would start you out small, like with a $50K loan (or less) to see how you handle it...

Offline Redstar1324

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Re: How to use OPM to fund house rehabs?
« Reply #9 on: September 19, 2016, 11:20:42 am »
That figure was for individual private investors.

Of course, I need to find a house to rehab first so I can make sure I can do one.

Offline Bradbaf

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How to use OPM to fund house rehabs
« Reply #10 on: January 12, 2017, 02:13:01 am »
Here is an idea. Use the PO at the dealer that says yes and dont buy from the ones that say no. Problem solved

 




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