Investor · Bloomfield, CT · Member since 2016 · 86 posts · 25 votes
As a new investor in CT, I'm looking to flip my first property and would like to understand what lending options are available to me. I've read the BP Ultimate guide, several books, and a number of forums on the subject, but I'm still not 100% clear on what's available for my personal situation.
I have very good credit, good income, and no debt except for a first and second on my primary residence (in other words, I would easily qualify for a conventional mortgage).
But if I found a great deal, say tomorrow, and wanted to close quickly to make sure the deal happens, what are my best options? Let's say I can put 20-25% down on the total financed value (e.g., purchase+rehab cost) or even on the ARV.
Should I pursue conventional, rehab/construction loan (are these available?), hard money, etc.?
Any conventional lender including portfolio lenders won't move that quickly. Shop around in CT for local hard money lenders. Go to the CT REIA and other groups in your area. Listen to Podcast 9. Ask other investors in your local area who they use and recommend. Don't work with someone who someone else hasn't recommended.
I don't work in CT so can't help you with actual referrals.
From my experience, it sounds like you have to go with a hard money lender. Most conventional loans won't support a flip. Hard money lenders aren't horrible but you just need to know that they are going to cut into your profit. A hard money lender will want some skin in the game but each has their own rules. My guy requires that the LTV of total project is no more than 65%. Depending on the deal I get, it changes how much I have to put down. I'm just one person though, maybe someone else has some other insight for you.
Any conventional lender including portfolio lenders won't move that quickly. Shop around in CT for local hard money lenders. Go to the CT REIA and other groups in your area. Listen to Podcast 9. Ask other investors in your local area who they use and recommend. Don't work with someone who someone else hasn't recommended.
I don't work in CT so can't help you with actual referrals.
@Ann Bellamy, thanks for your advice. I listened to show 9; it was a wealth of helpful information. I have started asking around and will get involved with local networking groups. Thanks so much :)
@Filipe Pereira. I think it was Gary. I did not end up getting his brochure because I have been "feeling out" another guy @Jon F. Jon is in Simsbury, right next door to me and we have opened some nice dialogue on a few things that may come to fruition. Still in the early stages of research to see if the project is feasible within my specs. So I can't personally vouch for Jon yet, he seems to have a decent range of investors/hedge fund guys that loan from conventional all the way to the hard $$, including commercial (small and large)
I am new to Bigger Pockets. I live in Northwestern Ct looking for lending options. My partner and I our looking at renting Condos. I will listen to Podcast 9 and follow this thread if you don't mind.
@Philip Pape There are a ton of people who have money to lend in CT as hard money lenders. Make sure you vet then by talking to actual investors who have completed deals with any ones that you are considering using.
All hard money lenders are not created equal and it is very much a relationship and referral business.