Hard money lenders for free and clear rehab?

Just running this around in our heads my dad owns this house free and clear in the state of pennsylvania it needs total rehabb, we can not figure out how to go about finding a private or hard money lender to get started with this project. We know how to do the work but the financing is the hard part and we dont want to sit around waiting for credit checks and all that paper work as that would tie it all up for many weeks and months.

We need some advice we are ready to go.

Anyone have suggestions.

Have you tried contacting any Hard money Lenders?

Here is a link to some. http://www.reiclub.com/hard-money-lenders.php

Md - you have your own business…as a broker?

new investor,

this gets treated just the same as a hard money purchase.

The funds coming to for the rehab could be up to about 65-70% of the after repaired value. Hopefuly you wont need that much to get it fixed up. Cost and payments can sometime be rolled into the loan.

Dont forget that most hard money lenders will not advance money for the rehab out. This money is there for reimbursement of work completed and inspected. So you’d need some funds to get started in phases or a flexible contractor.

Depending on your credit situation, there may be better options than hard money. Conventional lenders offer rehab loans also. These loans allow for fix up money to be advanced out.

I can help direct you better if I knew what state you were in, your credit score, time on the job, and how much in the bank you have.

I do not know why you would go through any hard money or private money banks for this deal. Granted they are not credit based but they are still income based and will need to go full doc for you to get this loan. Also, they will be capped at 65- 75% of the ARV - when you can go to greenpoint as a stated loan (yes, with a credit check) and they lend up to 90% commercial rehab properties (ARV). Greenpoint is actually a very competitive bank when it comes to projects like this. Also, greenpoint will not have a 12-14% rate nor a 12- 18 month period in which you have to repay the loan (refi out of that mortgage); going to greenpoint you can also set up a bridge loan where they fund the property at arv and then when completed they change the loan to the as is value which will bring down the rate they offer without having to refinance (b/c) it is set up for you already. You may want to contact a referred broker/lo to help you as they get into creativity like this more often.

Also, to qualm your fear of the time issue. Credit pulls are painless, they only have to be done once or twice and that is it. Going around and collecting income docs like w2’s, recent pay stubs and any subordinate income docs (just to get the loan) is really what can hold up deals.
Brokers/LOs are more receptive to stated incomes (more than a bank directly) and you can literally tell them what you do and how much you make and that is enough requirement for the income portion. Everything else is pretty standard. Good Luck.
(also, it is a good idea to know how much you are willing to pay a broker for his services before hand; so it does not become an issue later. ps. Hard money can charge b/n 2 - 4 discount points just to do the loan- a good broker should charge between 1-2 origination).

The program you speak of doesn’t apply to residential properties (1-4 units).


Scott Miller

With properties owned free and clear requiring rehab, I recommend that my clients consider a conventional “as is” cash out refinance; it allows you to fund rehab costs and extract capital investment at the same time.


Scott Miller

[quote author=EZLoanz link=topic=26722.msg126050#msg126050 date=1176624477]
The program you speak of doesn’t apply to residential properties (1-4 units).

Scott Miller

Uh, yeah it does. When is the last time you brokered out a deal like that.

how much money are we talking for the “total rehab”.

i’m curious.

this is extremely important.

i think somewhere in this thread, we’ve all lost sight of this.

when you say “total rehab”, what does this mean exactly.

take us through the house and your ideas for renovating it.

also, go over the local market in your area. it’s pennsylvania and good things are happening there overall, but again, real estate is LOCAL, so give us the details. then we can discuss financing (or not financing) and your options…