Is Do Hard Money legit?

[Alec Rosario]

This would be my absolute first flip and I've already identified a property that is selling for $50k, and the literal next door over was just bought for $65k and sold for $125k 3 months later.

My Question is: I'm preapproved with Do Hard Money who is offering to give me for my first flip 70% of the ARV. They're offering 5.5 Points on the project and 1.25% interest per month on the money. I have to only put down a $3,000 Down Payment which, after the entire project is done they'll refund me $2,350. Otherwise, the only other money I'll have to put down is earnest money.

They say that they'll fund 100% of the Purchase and Rehab costs if it's under 70% of ARV. Is this a good deal? Is this normal?

[Ebonne Davis]

@Alec Rosario

I am in the process of closing my 1st deal on our first flip property. I can only say the best things thus far of DHM. With every concern, question, uncertainty they have been right there to walk me through and get me over the tight rope. I would hope they speak so highly of me... lol. I can be a hand ful!

My application process went smooth and yes we paid the sign up fee for the 100% financing,

Yes we have an adviser,

Yes we have a project manager.

Yes we have access to 3 deals at a time,

Yes the 1st evaluation is free and we have to pay for the others, I made sure to ask every question there is. And I am still finding questions to ask.

All I can say if you're afraid to spend some money and Jump, DHM and or any other HM lender private financing may not be for you. I appreciate a company taking a chance on us. And in the end we are all making some money!

The motto is find a great deal.... A great deal is not just what the profit is, but all of the cost included. I located a property in Balto, MD- 21215 through my realtor, I offered less than asking, asking price was 75k I contracted it for 68k, paid 1k EMD, needs a complete reno budget is 30k. I determined ARV was 178k, evaluators came out and estimated 189-190k(winning)!! No payments for 5 months

Property evaluation APPROVED!

Its all in the numbers,

Getting into Investing I've learned so much from DHM in the last 30 days.

Numbers don't lie people do......

My husband and I are waiting for our final step to process. tentative closing date 09/24/18

I will keep you guys updated!

"the individual who say's it is not possible should move out of the way of those doing it"~ Tricia Cunningham

[Ebonne Davis]

@jacque Fairbourn

[Ebonne Davis]

I believe something is better than nothing, 
Especially if you come to the table with nothing, 
just my opinion. I'm currently working with DHM, and I have no complaints thus far!

Originally posted by @Earl Batiste:

no luck with do hard money, they want to much of the pie.  You will go hungry and homeless messing with that company 

[Ebonne Davis]

Actually, (copied from https://support.dohardmoney.com/hc/en-us/articles/...) 

"Yes. We will refinance a property if the following criteria apply:

• You purchased a property at a tax sale, foreclosure sale, or in another situation where you had to use your cash to make the purchase. We are happy to refinance so you can get your capital back in your hands. In doing so, we will lend on the same loan-to-value (LTV) as any other loan or on your acquisition price, whichever is less. For the following twelve month period, we will use the lesser value of either the acquisition price or loan-to-value (LTV).
• If you own a property (either free and clear or otherwise), we will lend on the same loan-to-value (LTV) as any other loan or on your acquisition price, whichever is less. For the following twelve month period, we will use the lesser value of either the acquisition price or loan-to-value (LTV). If you acquired the property over twelve months ago, we will reduce the loan amount.

We will perform a close inspection of this property. If we are also paying off a traditional lender at a lower rate, we will be looking very closely as to your purpose in doing this. We will need to know the reason behind doing a refinance and the details on your existing first loan."

I hope this answered your question :) 

Have a great day!!

Originally posted by @Stephanie P.:

Originally posted by @Nicholas Middleton:

Does Do Hard Money have any refinance options into a conventional mortgage once rehab is done?

 No

[Stephanie P.]

...so the answer is still no.  

They do not have any refinance options into a conventional mortgage.  A conventional mortgage would be defined as a loan backed by Fannie Mae or Freddie Mac, also sometimes called "conventional financing".

[Jason D.]

I've found DHM to be legit, but they are very expensive compared to other hard money lenders. 5.5 points and 15% interest, yikes. Plus $600 per appraisal?

[Delroy Henderson Jr]

Hello @Ebonne Davis

How did your flip go with DHM? Im looking to do a flip in Baltimore as well, and I thought of using DHM, and wanted to know about your first hand experience in working with them. Thank you.

[Jason Hirko]

Originally posted by @Jason D.:
I've found DHM to be legit, but they are very expensive compared to other hard money lenders. 5.5 points and 15% interest, yikes. Plus $600 per appraisal? @Jay Hinrichs

 I got this in the mail yesterday trying to get me to invest in their 'fund.' Shows they are making up to 27.35% APY on their loans. That seems pretty crazy to me, and I'm a hard money lender lol

[Jason D.]

@Jason Hirko it's funny to see how they pitch the "other side". That's gold right there!

[Michael Van]

bump

Has anyone else here had any experience with using DoHardMoney or would you recommend another route? If you do recommend another route, can someone point one out that funds almost 100% like this one does? I am starting my first flip but have a GC that's been remodeling houses for awhile so he wants to move to the flip game. 

[Michael Van]

@Ebonne Davis

What was the update on your deal? How did everything turn out? Are you continuing to use DHM?

[Sonia Heathman]

Thanks for the insight! I've been checking them out for a while now.

[LaTasha Norris]

I just spoke with someone from DoHardMoney Lending.  The program rates are steep; however the 100% funding is very attractive.  Is there any updates from anyone in the group who has completed a fix/flip with them? 

[Robert Morgan]

They  want $3000  for  Training  Before they  Fund you

[Arroyo Aaron]

After paying $3000 will you have pay anymore money out of pocket.?

[Michaela Cephas]

DHM is ridiculous. They use the lowest comps they can possibly find to give you your ARV. They require comps within 1 mile 10%+ or 10%- the sqf of the subject property and it has to be sold within the last 90 days. I live in a city that can change from middle class to lower class pretty quick and they don't use newly renovated comps, they use the bare minimum as long as its inhabitable.They also start charging higher interest rates and origination fees for more expensive projects, and even add a $1,600 single purpose entity fee. They require your contract to be assignable or the buyer to be " [address] Industries, LLC", which is complicated to explain to a seller, especially if they have a good Realtor. Overall, finding a deal that will qualify is virtually impossible. I could go on and on. I wrote a BBB complaint and hope to be refunded my deposit.

[Jacque Fairbourn]

@Michaela Cephas - As far as our direct loans, yes we use the lowest comps, if you are going to get no/low cash to close funding then we are taking on a great deal more risk and need to be conservative. If a deal is profitable using the lowest comps then selling it at a higher price just means more profit. Basing your expectations for profit on anything other than the lower end is too risky. Other lenders may be willing to do that if you are providing a large down payment, will be making monthly payments, have additional cash reserves, have good credit, and have experience. The single purpose entity we require is structured to protect our borrowers and investors in a worst-case scenario to speed our recovery process and ensure our borrowers do not have a foreclosure on their records. We do not charge higher interest rates or origination if the project is bigger. For our directly funded loans, we will not fund more than $350,000, origination and interest rates are based on credit score.  For our other loan programs where you need good credit, down payment, make monthly payments and need flipping experience the loan options will vary. 

Because we provide funding to investors that no other lender will lend to, our criteria is more stringent, we don't deny that. If you can find better financing for a project we want you to do that. We are not the best lender for every deal or every investor. But our criteria is based upon solid risk mitigation. We need to be reasonably sure not only of the ARV estimate but that the rehab can be completed and the property sold before the end of the loan term. If you cannot do a deal at all because you cannot get funding then that deal is not profitable either. A BBB complaint will not help you obtain a refund.

The $3000 enrollment fee is for access to training/tools/software/support to find/value/purchase/rehab properties with high margin and low competition that will qualify for 100% financing. It is not a deposit at all. It is not part of your loan. However, if you fall into one of the following categories : new investor, bad credit, want no/low cash to close and no monthly payments, then we will require enrollment to get 100% financing loan so that you can learn how to find those deals and so that we have the support staff to help you. This lowers our risk and our borrowers' risk. Looking into your account I only see one loan application, and on that application, it says that the property was located on the MLS. Generally, you will not be able to find properties that qualify for this no/low cash to close, no monthly payment financing on the MLS. That is why your enrollment includes all of the other finding strategies that it does and the software that allows you to search for properties before they are even listed.

@Arroyo Aaron - the $3000 is for membership enrollment that helps you learn the type of property finding/valuing system for deals that can qualify for no/low cash to close funding, or that have risk variables that allow us to lend to those with bad credit or that have never flipped a home. It is not part of the loan. Not all of the deals we fund are at no cash to close. However, we do have statistics to back up that 1 in 4 of our borrowers needed less than $2000 to close last year with no monthly payments for the first 5 months. 

@Jason D. , of course, our investors that put up the money make great returns, they are taking a big risk with these loans. (Hope things are going well for you :) )

We know that our lending model is different than other lenders, and as mentioned before if you can find funding with rates that work better for you then we would encourage you to do so. But if you want to complete a flip without using much of your own out of pocket money and not worry about making payments while completing a rehab then this can be a good option. If you have bad credit or have not flipped before then this can be a good option. If you don't need that type of loan we do have the more traditional money down loans available. Enrollment in our system is not required for those.

Working with primarily new investors the way that we do means we incur a great deal more costs in the way of customer support than most lenders, as well as more risk. When we previously offered this type of loan without the support system and resources we were unable to help all of the people that needed it. We found that so many people were just looking at the MLS and giving up after 1-3 properties. New investors do not understand that it generally takes looking at 50+ properties before finding one that will work. They don't necessarily know how to learn from a deal that has been turned down. They are not as experienced in planning/pricing a rehab, let alone completing it on time and on budget.

People on an internet forum who have not evaluated your property, your experience, your credit profile, your contractor estimate etc. are not in a position to tell you that you can get better terms. They are not in a position to tell you what kind of assistance you need. Unless they are willing to drive/fly to your potential deal to evaluate it, work with your contractor to scope and tighten the rehab figures and make sure that it makes the property competitive in that specific market, take all the phone calls to answer your questions, call you repeatedly to remind you to complete all of the required documents, provide a construction project manager to work with you and your contractor on a weekly basis, provide independent inspection of renovation work,  as well as provide all of the property purchase costs, rehab costs and loan costs, holding costs and selling costs until the property sells, without taking any monthly payments, then they really cannot tell you whether or not any funding option is the right one for you. 

 Yes, there are lenders that offer lower rates, but maybe not for your specific deal. If we turn a deal down we are turning down an opportunity for us to make money, so we don't do it without good reason. 

[Cesar Gomez]

Am not sure how I will make more money, getting a loan from them and flipping properties.... or investing and lending money with them:

[Rod Powell]

DO NOT WORK with this company! They appear to be awesome on the surface and offer some great tools, but their sales practices are dishonest. 

1.The sales associate Steve Martin told me on the phone that the access to the online portal would not expire on the phone (I even recorded the call). Later I found this was NOT true. 

2. I submitted a deal with them and initially they sent mesomeone else's appraisal in an entirely different state back. 

3. Next when they did send back the correct property appraisal (which took almost a month to complete) they under valued for financing even after I put all specs into the deal analyzer and it came back 100%. Ultimately it was slam dunk that just couldn't get done. 

They look bright and shiny on the surface but under it all they really want that 3000 (or 2350 after the inspection fee)

I've had to get my attorney now involved bc they refuse to even reactivate the portal to attempt to get a deal done with them. They want to charge 150 per mo or submit 10 deals to be appraised at 650 a pop. 

My advice is read be very mindful before doing business with them. Don't believe the associates AT ALL!!! They take advantage of new 'would be' investors and as I have continued to learn. Private money lenders typically dont ask for a fee upfront. 

Proceed at your own risk, but I wouldn't recommend. The biggest benefit is the online portal, which you can find software and specific services for that are transparent for that on your own. 

If you have No Money. Go wholesale. If you have 20-30k...Find another Lender!!!

-Rod

[Jay Hinrichs]

Originally posted by @Rod Powell:

DO NOT WORK with this company! They appear to be awesome on the surface and offer some great tools, but their sales practices are dishonest. 

1.The sales associate Steve Martin told me on the phone that the access to the online portal would not expire on the phone (I even recorded the call). Later I found this was NOT true. 

2. I submitted a deal with them and initially they sent mesomeone else's appraisal in an entirely different state back. 

3. Next when they did send back the correct property appraisal (which took almost a month to complete) they under valued for financing even after I put all specs into the deal analyzer and it came back 100%. Ultimately it was slam dunk that just couldn't get done. 

They look bright and shiny on the surface but under it all they really want that 3000 (or 2350 after the inspection fee)

I've had to get my attorney now involved bc they refuse to even reactivate the portal to attempt to get a deal done with them. They want to charge 150 per mo or submit 10 deals to be appraised at 650 a pop. 

My advice is read be very mindful before doing business with them. Don't believe the associates AT ALL!!! They take advantage of new 'would be' investors and as I have continued to learn. Private money lenders typically dont ask for a fee upfront. 

Proceed at your own risk, but I wouldn't recommend. The biggest benefit is the online portal, which you can find software and specific services for that are transparent for that on your own. 

If you have No Money. Go wholesale. If you have 20-30k...Find another Lender!!!

-Rod

Yup that's the feedback that we see on BP quite often.. never the same story other than they really want the 3k non refundable fee.

although they will say its not mandatory but I have yet to have anyone say they got a loan without it or seen it posted on bp

[Shaun Gaither]

Avoid do hard money! They just want your 3k and will refuse/deny just about any deal you send their way, especially if the property is in a metropolitan area. Then again, if you find one in a rural or suburban area, they'll still find a way to deny funding and pocket your cash. No other HML does that. They basically con new investors by promising 100% financing, take your "good faith" money and keep it. It seems their intention is moreso to acquire private money from new investors and not give them a return on their investment. If you want to give away a few grand to never see it again, by all means go to Do Hard Money. They'll be happy to take your hard earned money.

[Nicholas Ottoy]

Hello, I have to agree with every negative comment I have read so far. I had their services for 2 months until this point and had not realized how impossible these figured are to hit. I found a property that has a purchase price of 220k with 15k in rehab which would be 235k. I have an ARV of 280k which would be a 45k gross profit which isn't too bad. After I put it in the deal analyzer the calculator says I will profit negative must I repeat NEGATIVE $47,000. I have no idea how anyone would make any money with the origination fees and other insane charges equalling out to almost 100k???? Indeed what everyone had said is true and all they want is the 3k. They called me numerous times before I got the service and eventually I signed after their annoying sales marketing (which I did rather quickly and ignorantly on my part I must say). After that I have never been contacted to be checked in on and it is impossible to find any deal worth it to get that 2300 back. At this point I will attempt legal action to get the money back but most likely I will be out 3.5k which I could have used on actually investing instead of this BS. Someone please help me and stay far away from this organization.