Hard money to finance the rehab?

[Kris Marmol]

Hello I am looking to invest in a few properties out of state and throughout my search I’ve found a few private or Hard money lenders that are willing to finance 100% of the improvements and 90% of the homes purchase price. My question is should I put the down payment (25%) that I am planning on putting for each property through the hard money lending loan and pay for the repairs separately? Beyond the obvious benefit what other advantages are there to having a hard money lender finance the repairs? Does it make any difference if I put the money down then or when I refinance?

[Jay Hinrichs]

one thing to consider is HML usually only advance for work done.. and contractors for rental rehabs RARELY will work on the come.. so in essence you have to pay them then get back filled.

also if you dont use the HML for rehab you dont have to go through all their submission process's and pay for inspections etc etc..

not to mention the savings on points and interest for the rehab funds..  so if your money is just sitting in the bank you could save a few grand