How do you guys get money for rehab? Its a real simple question that I seem to have trouble getting answered. Any suggestions would be greatly appreciated, thanks
Alot of people starting out take money out of the equity in their current primary res home. Some run up massive debt in credit cards and then pay them off after the sale. Some have an investor who is usually a close friend or relative with cash to spare until the house sells.
Well, you can look at Hard Money Lenders (HML) you can also look to private lenders ( please read up on that topic) or you can put your own cash in.
You could also look to bring in partners that have the money.
These are all valid. I suggest some education on rehabbing and getting the funds for it.
Hope that helps!
you can find lenders who will lend 80 or 90% of after repaired value, putting the rehab cash into escrow you can draw on. rates are much more competitive than hard money.
There are many rehab lenders out there that will finance your flip up to 16%, for 6-12 month term, usually with 2-4 points at closing. Some will go as high as 75% ltv on the after repair value, but most will only go to 65%.
EGAD! I called it a rental, got 90% ARV at 8.5%.
mcwagner,
Which lender did you go throught to get 90% arv? Did you put money down and pay points, was there any money out of your pocket for this loan? How did they advance your rehab money - cash at closing?
Just wondering - it sounds good.
Thanks
rehab money goes into escrow, which is a pain but better than using my cash. I think there were points involved, but nothing like a hard lender. I’ll message you offline with details.