100% financing hard money lender

[Jorge Pena]

Good afternoon,

I’m located in Houston, Texas and have been been interested in real estate (rental properties) for a few months already and want to get started soon. I don’t have a lot of money saved up but have been hearing a lot about hard money lenders. Does anyone know of any hard money lenders that finance 100% and require no down payment especially for new investors like myself?

Thank you

[Mark Sewell]

Originally posted by @Jorge Pena:

Good afternoon,

I’m located in Houston, Texas and have been been interested in real estate (rental properties) for a few months already and want to get started soon. I don’t have a lot of money saved up but have been hearing a lot about hard money lenders. Does anyone know of any hard money lenders that finance 100% and require no down payment especially for new investors like myself?

Thank you

Just about all of them will do this, provided you buy it deep enough. 

Here is what I mean: We loan up to 70% of ARV on your house. Your house ARV is $200k, so we lend up to 140 which has to include your renovations. Great, you say. You go buy the house for $99K, and the renovations are determined to be about $36k (it is a mess). So there you are at $135K. Now you can roll in $5k of your closing costs.

You might come out of pocket about $2k in this scenario.

And it is not common, but now that I am in this HM lending gig, I see that it happens more than I would have guessed.

So does this mean that you can start doing deals with no money?  No, not really.  You do need to show some liquid reserves - that can be a combination of cash + credit lines.  You don't have to hand it all over to your lender, but you do have to document that you do have it.  

We want to see that you have (a) enough money to pay closing costs (b) enough money to make 6 months of payments and (c) about 1/3 of your total renovation budget.  So using the scenario above, you'll have to show me that you have about $24k in liquid reserves - even though you are only required to show up to closing with $2k down.