Private Money- Buy & Hold

[Jordan Shay]

Does it make sense to use private money for buy and holds? I want to invest in buy and holds and I don't want to use having no money as an excuse not to invest, but does it make sense to use private money for these? Would it need to be a fixer upper that could later be refinanced? I'm just trying to think of the exit strategy. Any feedback would be appreciated.

[Hunter Letchman]

Jordan, Private money is typically going to be a higher interest rate loan, so you would want to use it for a few situations: 1., you have too many conventional loans and do not qualify for another bank loan; 2., you don't have the cash reserves to get in the door with 20-25% down that a typical bank loan requires.  PM will definitely work for buy and hold, it just increases your cost and you don't want to use it for turnkey, typically only value-add like a flip-to-hold.  Hope this helps.