Private Money Lender & Multifamily Refinancing (Questions)

[Mike Dusenka]

Let's say you use a private money lender, so you pay cash for a multifamily property and the rehab costs. Is it more difficult to cash-out refinance after you raise the value of the home compared to an HML or traditional loan?

I understand multifamily's value is appraised NOI/CAP=ARV compared to how "nice" a single-family home is correlated to its comps. Besides how the property is appraised, what are the differences between qualifying for multifamily refinance compared to a single-family refinance?

[Mike Dusenka]

Originally posted by @Danny Randazzo:

@Mike Dusenka what size property are you talking about? If it’s less than $1M you will likely use a local community bank for financing. Commercial loans are easier to deal with versus residential but you are still dealing with a bank. Using hard money lenders might be a bit more straightforward but it all depends on who you work with.

Hey @Danny Randazzo

Thanks for the reply.

It's less than $1M, but ARV is over $1M. Are you saying it is challenging to get Private Money lender loans for under $1M?

I'm wondering when I get a Private Money loan what the difficulties in refinancing with a bank/credit union compared to an HML to refinance with bank/credit union? Or is it a similar process? Just want to know the Pros and Cons of a Private Money loan when I refinance.