Hard money loan first time investor

[Suki Su]

I am interested in applying the brrrr strategy with residential multi-family properties and would like to use a HML. I understand that if I am doing this for the first time the HML is going to want me to put about 25% down. My question is if the purchase price is $50k and I need 100k for repairs is it 25% of just the puchase price or is it 25% of the purchase and rehab total? Also for the monthly payments which I understand to be interest only, if within the first 6 months I refinance am I required to pay the last 6 months interest only payments?

[Bo Kim]

@Suki Su It really depends on the HML, Ive seen % of the total or different % by PP and Rehab costs.

As for application fees, interest only vs principle, other layovers, its all negotiable and differs by lenders. Ive found that as you build a relationship w/ them and do more deals, they get more lax and may pass on small things such as app fees. They seem to like repeat customers :)