Has anyone had success raising %100 capital from a hard money len

Question

Hey BP family, Has anyone had success raising %100 capital from a hard money lender? I’ve seen them advertise up to %90 but is it possible to get 100%?

Ryan Deasy · Answer

@Jay Ben

i have seen 100% but its tricky. from my understanding you would need a killer deal and alot of experience under your belt.

Marty Johnston · Answer

@Jay Ben I'd agree with everyone here so far, the only addition I would make however is through gap funding. Most people recommend finding a partner, negotiating whatever "split" to come to, sometimes 50%, sometimes more/less. An alternative is using unsecured debt to cover the down payment + closing costs. You're looking at pretty steep rates though, ranging from 5% - 18% and hefty fees, albeit paid out of the proceeds (800+ credit, very low DTI and credit utilization, etc). No Prepayment penalties and this really only ever works for rehabbers or builders/developers since these terms don't pencil out for any rental properties, as they eat the cashflow, but if your deal has good numbers, these loans can help you scale quicker and save you your equity.

Feel free to DM me if you'd like to discuss this scenario a bit more!

Ryan Lockstein · Answer

I have recently done plenty of deals where lender covers 100% of everything (purchase, rehab, closing costs). However I had a good amount of experience behind me flipping before I was able to get these terms. It doesn't specify your experience in your initial question but if you are new, I would say it is going to be very tough to find those those terms. If you are experienced, it is very possible.

Bob S. · Answer

I guess its possible, but I would never lend anyone a penny unless they have at least 10 deals under their belt, even then I would only do 60% of the ARV. If you have no experience its not going to happen

Chris Seveney · Answer

@Jay Ben

You will not get 100% capital from a HML, especially if you have zero experience

Eliott Elias · Answer

I have, i used a property i had paid off as collateral

Michael Kinsella · Answer

What @Chris Seveney said is correct.

Even when lenders advertise "up to 100% LTC", it's generally not what new investors have in mind.

100% financing from a HML means that you may still need to cover closing costs and will almost certainly have to provide the initial capital outlay for the renovation work, which is typically funded on a reimbursement basis.

Has anyone had success raising %100 capital from a hard money len

Has anyone had success raising %100 capital from a hard money len

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