Private lending in Western Mass not as easy as I thought

[Ramon Alvarez]

So I find myself here again in a tough situation . So when I talk to a lending company, everyone states that what I'm looking to lend ($72,500) is to low for the company to lend. So they say they have another sister company that does loans lower . Then I reach out to that company , they state that I need to close on the loan in the form in an LLC.

So one minute I'm told I can get lending through these "private lending companies, next thing I can't get lending because the amount is too low to lend or I need to close in an LLC. I guess I'm just stuck. I have enough cash in reserves to get me in just about anything with a conventional loan but with these smaller short term loans, seems to be a little bit more tricky.

Does anyone have an advice or experience in acquiring short terms loans for their flips or projects?? I'm looking to flip my first property this year and would like to get the ball rolling . The longer it takes to get funding , the harder it is to lock in a good deal for my area . Any advice or assistance in this area would be greatly appreciated. Thanks in advance BP. 

[Ann Bellamy]

@Ramon Alvarez, don't let the requirement to buy in an entity (LLC) stop you. That is a minor inconvenience. You can form your LLC online in about 10 minutes at mass.gov. You need an attorney to draft your operating agreement, or you can reach out to others who have LLCs and might be willing to share theirs so you can draft one to meet your needs.

One of the challenges of finding lenders in Western Mass is that the largest # of lenders are in central and eastern MA and they don't want to drive that far.  in addition, the numbers are small enough in Western MA that the deal is below their minimum, as you mentioned.  The reason is the smaller the loan, the less money the lender makes for the same amount of effort.  Or even more effort driving a few hours.  

I would keep attending the Western Mass REIA and possibly CTREIA. One word of warning: be sure to google the person. I do know a few lenders who operate in that area who should be avoided.

And for your reference, I'm sorry, I also don't lend in Western MA.