Need hard money for buy and hold on a great deal.

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Need hard money for buy and hold on a great deal.

Tzvi BalsamPro Member
Investor · Brooklyn, NY · Member since 2016 · 226 posts · 45 votes

I was speaking to a company and they told me they only do 2-4 Unit property's 

I am looking for 350K Loan, for a 6 Unit that is like 80 Percent LTV and I need it fast. Looking to pay like 10 Percent interest but do not want to pay points, Any advice would be great.

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Don KonipolBusiness Member
Investor · The Woodlands TX / Avon, CT · Member since 2009 · 6k+ posts · 10k+ votes
10y

Whether and what type of financing is available will depend on the answer to these questions

1. What is the condition of the property?

2. How much of your own money are you putting into the purchase?

3. How much rehab is needed?

4. What is is historical and current occupancy rate?

5. Is the neighborhood aprreciating, holding steady, or in decline?

6. What is your credit history?

7. Are the last two years financial statements for the property available?

8. What is the operating income of the property?

9. How strong is your personal financial statement?

10. What is your experience level with multi family real estate investment?

As the positive answers to the above questions increase, your funding options get greater, your interest rate and points decrease, and your chance of funding increase.  As the negative answers grow greater, your options narrow, money becomes more expensive, and your chance of funding decrease.

Private Mortgage Financing Partners, LLC
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  • Eddie T.
    Rental Property Investor · NY · Member since 2013 · 844 posts · 350 votes
    10y
    Tzvi Balsam it would be better if you told us what city the property is in as some lenders only work in some areas... Also some photos to generate interest... Your exit plan for the loan... Your real estate experience.
    0Reply
  • Tzvi BalsamPro Member
    OP
    Investor · Brooklyn, NY · Member since 2016 · 226 posts · 45 votes
    10y

    @Eddie T.

    Its in Bayonne NJ I am looking to sell it in a year, I do not want to be hit with a Prepay penalty on my mortgage so it is just cheaper If I can get hard money. 

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  • Wayne Brooks
    Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    10y

    Hard money, even as low as 10%, will not be cheaper than a normal loan with a prepayment penalty.

    Hard money usually has a lower LTV, and 30% or so minimum cash down on your part.

    0Reply
  • Anthony SuscoPro Member
    Lender · Turnersville, NJ · Member since 2016 · 173 posts · 68 votes
    10y

    @Tzvi Balsam,

    You will be hard pressed to find HMLs that will lend out at 10% or less with no points. Especially as high as 80% LTV.

    As @Wayne Brooks said, if you can find a bank to give you a mortgage on this deal, that would be the cheapest way to go regardless of prepayment penalty

    0Reply
  • Tzvi BalsamPro Member
    OP
    Investor · Brooklyn, NY · Member since 2016 · 226 posts · 45 votes
    10y

    What about a bridge loan ?

    0Reply
  • Don KonipolBusiness Member
    Investor · The Woodlands TX / Avon, CT · Member since 2009 · 6k+ posts · 10k+ votes
    10y

    Whether and what type of financing is available will depend on the answer to these questions

    1. What is the condition of the property?

    2. How much of your own money are you putting into the purchase?

    3. How much rehab is needed?

    4. What is is historical and current occupancy rate?

    5. Is the neighborhood aprreciating, holding steady, or in decline?

    6. What is your credit history?

    7. Are the last two years financial statements for the property available?

    8. What is the operating income of the property?

    9. How strong is your personal financial statement?

    10. What is your experience level with multi family real estate investment?

    As the positive answers to the above questions increase, your funding options get greater, your interest rate and points decrease, and your chance of funding increase.  As the negative answers grow greater, your options narrow, money becomes more expensive, and your chance of funding decrease.

    Private Mortgage Financing Partners, LLC
    WebsiteView Page
    2Reply
  • Jason Hirko
    Lender · San Antonio, TX · Member since 2016 · 1k+ posts · 1k+ votes
    10y

    @Tzvi Balsam To give you some perspective, even for my best clients, I couldn't do this deal for two reasons:

    1. Points - we always need at least 2 points - it's the cost of capital

    2. LTV - 80% is not great, especially with only 10% down, unless you're planning on adding equity through a big rehab. I do 10% down when the loan is south of 70% of ARV

    Hope that helps you get an idea of what a lender needs...

    1Reply
  • Robert Grant
    Lender · Los Angeles, CA · Member since 2016 · 98 posts · 17 votes
    10y

    @Tzvi Balsam - If you're okay with 75%LTV, then message me directly and I'll give you the rest of the parameters. In NJ, you can bring that deal in directly without a broker involved and there's no PPP if loan closes in an individuals name versus entity.


    Best,

    Robert

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