Due to some general irresponsibility I am rebuilding my credit, it’s like 575.
I want to do a deal, will a hard money lender lend me money to purchase a property if I have the money to get 30% or so of the rehab completed?
I am a skilled rehabber and can provide trade references of very happy customers i have completed rehabs for.
Hi,
Typically Hard Money Lenders work on the premise that you have skin in the game! Some Hard Money Lenders will only loan a percentage against your purchase price, while others will loan a percentage against your purchase price and rehab (Repair) cost's!
With that said all will want at least 10% from the borrower and may want as much as 30% from the borrower for down payment depending on the market!
Most Hard Money Lenders will over look your credit to some extent the more cash you can provide as down payment to reduce the lenders risk! You will need to talk to a bunch of Hard Money Lenders about your situation and specifics around credit and abilities (Track Record) as one will certainly be different from another, and one will have more demands and be more stringent and one may have less demands and be more flexible the more money you can put in!
GR
Most lenders that I know require a minimum credit score. Cash can cure most credit issues. If you bring more cash to the table lowering the LTV and increasing your “skin in the game” then you can get around having poor credit.
Good luck!
With such poor credit. You will hardly find something like that. But with a strong spirit, you will find what you’ve been looking for.
Absolutely, I know my credit score is a major factor. I have completed dozens of rehabs for several investors. My knowledge and skill will speak for themselves. I can fund one rehab completely or use hard money and have one on deck to go to once the first is complete. I will use my investors as reference and also ask them if they would like to be my lender. I’d gladly pay 10%-or 12% for a short term loan. $2500-$3500 for a 3-5 month deal may be attractive to one of them.
This is where a relationship may be greatest asset. Personal knowledge of my work ethic and ability may help me overcome credit score.
Cash can cure most credit issues.
I agree with DHLC …Alot of skin in the game and poor credit = Possible loan to own…So be careful and have a few solid exit strategies in place…Hard money lenders want the deal a no brainer for them,not you…
find out if any of the people you have done rehab work for use hard money, you might have an ‘in’ with a hard money lender already
The guy I do work for has a $1M line of credit. Good idea though.