Private money question

[Andrew Galeano]

Hey everyone,

So im currently thinking of putting a single family property under contract.

Here are the numbers

Purchase Price: $155,000

Rehab: $70,000

Arv: 325,000

I recently House hacked my first property in New Jersey.

Because of this, I am limited on money to invest.

I am planning to use Private $ loan for the full purchase and rehab @ 10%.

My biggest fear is if the property gets appraised for less than the 325k Comps i get from my realtor (which I will also do due dillegence and confirm those #’s) and I am unable to cash out refi.

Does anyone know the process of private $ and How I would be able to convert to a conventional loan if im unable to cash out refi and pay the Private Lender his $ ?

**I do not have the property under contract still must do an inspection + get a estimate on repairs from a GC, so even though I feel the repairs would come in less, thats pretty much the most im willing to go unless theres room for negotiation on the purchase price **

[Ryan Blake]

@Andrew Galeano Private money has no standard practices. What makes it private is that it is typically an individual who has extra cash to lend, not a company that has multiple people's money to lend. When you are lending just your own money there are a lot less regulations and every person will structure it slightly different. Some may be willing to go long term. You will need to talk with each individual about it.

And to add on to what just about everyone will say, a private lender is someone private that you know from a REIA or family/friends. If they are advertising, they are a hard money lender. Either way, just ask what they offer.