Is This Typical of Rehab Financing?

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I thought I had done all of my homework - the works: Months of research, an LLC set up, attorney, mortgage broker, accountant etc... etc... I have excellent credit (788). My personal residence currently has right at 20% equity in it. I am 33. I have a 401(k) that I can borrow from. Three cars that are paid off. Almost zero credit card debt. But, I have minimal cash on hand and not a ton of disposable monthly income.

My target properties right now are in the 30k to 80k plus repairs range. I just spoke with a local rehab lender about a rehab property that was looking like it might be a good opportunity. He informs me that he wont lend to me because I don't have enough liquid cash around to cover myself personally for 5 months. He will loan up to 90% of purchase price plus repair and holding costs - if I have enough personal reserves to cover "what ifs" and something he can attach his name to to cover the 10% (equity in my home or one of the cars).

I have options for obtaining the reserve cash he requires, 401(k) loan, put a note on one of the cars, etc, but I'd prefer to exercise those options if and when the need arises, not just to make him feel better. After all, whichever I choose, it's going to be a monthly payment that I will begin to have to cover.

I am getting into the real estate business knowingly exposing myself to risk. I am the guy that the term "paralysis by analysis" was coined for - and he knows this because I have known him for more than 20 years. Should I just bite the bullet and take out a loan to satisfy him, or should I look into the more expensive route of hard money? Or should I just look for another rehab lender? Or is this not the right time for me to get into the game? I am not where I want to be financially which is one reason why I am getting into the business, but it seems he wants me to already be where I am trying to get. Once I complete a decent rehab or two, I will have the basis he requires, but I need to figure out how to make the first few deals happen.

Does this all sound typical, or is he a little more conservative than most?

Thanks for any advice...