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Updated over 1 year ago on . Most recent reply

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Jason Watts
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First property. 100% financing...

Jason Watts
Posted

I'm on my journey to buying my first investment property before the end of the year and I've spoken with a couple lenders, and one gave me the name and number for a private money lender that would fund 100% of the right deal purchase and rehab on a 6 to 12 month term at probably 10-11% interest only.

our family has a close family friend who is an aggressive agent that I pretty much have to use. I spoke with her today and she warned me up one side and down the other not to try to get into real estate investing right now, especially with a 100% loan at 10-11%. Her concern being that I would use all of the loan for the purchase and have nothing left over for the rehab.

She also said that anything I find thats been on the market for more than 90 days cant be a good option because in this market because theres not going to be anything that a more experienced investor hasn't looked at and decided was a bad investment. 

all that to say, after my call with her, I'm feeling a little discouraged, but I still want to have my first property before the end of the year. Maybe I should not do a duplex for my first unit (which would be my preference), but rather a single family... I don't know. 

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Charles Carillo
  • Rental Property Investor
  • North Palm Beach, FL
1,930
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Charles Carillo
  • Rental Property Investor
  • North Palm Beach, FL
Replied

@Jason Watts

Yes, 100% financing puts you in a very high-risk situation. Not only after you purchase the property but what happens if you have an accepted offer on a property (and your deposit has become nonrefundable), and this 100% lender backs out before closing, you might need to find a normal HML that will require a down payment (skin in the game).

Regarding the agent; I would not feel pressured to work with anyone. It is your money, and your investments, you should feel comfortable using any agent (and anyone else) that is going to serve your needs the best. Everyone on this forum knows an agent (there are 1.6M Realtors in the US). Many of them (including myself) will not use the agent that is closest to the family since they do not focus on investors or for some other reason. 

Yes, many deals will be picked over on the MLS. Maybe start doing some outreach directly to owners, and see if you can start finding some distressed deals yourself (no agent is needed for this). I would also start building out the rest of your team (and speak to more HMLs).

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