Hard Money Loans: How do you afford repayment?

[Daryl Canard]

How do you properly use a hard money loan to purchase a rental property and then repay the lender what was borrowed plus the interest (or points)? Do you borrow the full amount of the purchase price from the HML or is it "easier" to only borrow enough money to make a down payment on a property?

[Darrell Shepherd]

You cant really borrow down payment money from a HML, not really what its for. They don't like to be in second position.

The only time a hard money loan makes sense for rental property is if you are rehabbing to refi and keep yourself as Joe said (and occasionally an exceptional deal where the cost of the capital is eclipsed by your increased money costs).  You want longer term money for rentals.  LimaOne Capital and LendingHome both have long term products that came out in May, LimaOne's is better IMO.  Really, though, you want to exhaust bank money before you start using that stuff or commercial loans.