First hard money loan fears??

[Account Closed]

hello all

Can anybody share if they had newbie fears about their first hml.   If so, how in the world did you get over it.  Say you buy an reo to flip and get into trouble with the budget, could an exit strategy be to list the property partially remodeled at a somewhat retail price to save yourself?   I'll be attending the general meeting next month( Long Island real estate investor association) .....if anybody is located in New York.  

[Kenneth B.]

I would think that depending how far along you are on the project would determine if this is possible. A conventional buyer probably won't be able to get a mortgage on a half completed property. That would leave you to cash buyers which will want the property at a discount. 

[Richard Jeffries]

I would have to agree with Kenneth. A partially finished home would not be worth the work done to it and the purchase price on the market. Tripple check your numbers before even putting in a offer, and make sure you budget a contingency. Also you would want to avoid doing project that would cost you more than 65-70% ARV. That way you have your profit cushion to fall on even after you use your contingency