Financing Questions

Several years ago I was trying to get started doing preforeclosures and had a finance partner who was willing to work the money end for a hefty portion of the profits. At that time I lived in an area where competition was extremely tight for the market and had extreme difficulty finding good deals, so I opted out for awhile.

I now live in an area where there are few investors and lots of great deals to be had. My only problem is finding a finance partner.

I am a 32 year old father of 3, with a stay at home wife (rheumatoid arthritis). I am a full-time student and work 9-18 hours a week at a dairy. Money on my end is extremely tight.

However, both my wife and I have fico scores of 700+ and we are own the home we live in (with the bank of course).

Is there anyone out there willing to join us as a finance partner in our flipping/rehabbing endeavors? If you are seriously interested, please send me a private message.

Are you familiar with hard money loans?

If not, I would recommend doing a search on this site or others to see how many investors highly recommend them.

Using other peoples money limits your liability and at the same time will help you achieve your goals.

If the deal is right along with your over all credit and experience, the lender can get you up to 100% of the money to purchase and fix up the property.

Usually they are short term notes and perfect for rehabs or short sales.

I do know about hard money loans. My research and reading has led me to believe that most hard money lenders don’t want to deal unless the loan is 60-80% LTV. If they are are talking rehabbed or resale value, that is definitely a viable option. If they are talking loan to purchase value, then that’s not workable unless I get more creative with some sellers.

For a rehab property you should be able to get up to 100% of the purchase + fix if with 65-70% of the after repaired value.

For a property that does not need to be fixed up, you should be able to get up to 100% of the purchase price if within 80% of the as-is value. Great for preforclosure properties that are bought below market value and need to be done quickly.

Ex. $200,000 current value
$150,000 sales price

   $160,000 maximum loan amount
   So this scenario would cover it + also leave room for
   points and interest to be coverd unitl sale/refi.

If keeping the property as a rental you could also consider doing a cash out refi immediately after purchase up to 90% of the appraised value.

That’s a reat option-thanks for clarifying it for me :slight_smile: