What am I doing wrong

[Raeshal Solomon]

Hey I'm in the process of flipping my first house and I have a hard money lender loan. I did not realize that you don't get your draw until after a part of your project is completed for example you get your demo draw (money) after the house has been demoed.

My first question is Is that common practice for hard money lender to not pay you until after a job has been done?

After we completed demo we had some unexpected expenses. I'm having to replace a whole wall because of water and termite damage none of this was in my rehab budget. So I paid for it out of my pocket however it's making it difficult to move on to the next part.

Is building a new outside wall and replacing the band seal the same as exterior capentry on a draw schedule rehab form?   

PS: My general contractor is being very reasonable considering the circumstances.

[Anthony Dadlani]

@Raeshal Solomon

Re- Draws not paid till work completed. 

Yes this is a very common practice. Investors and lenders need to protect themselves and only make payments once work has been inspected and completed. We do the same on any projects we are involved in. 

Best of luck in all your endeavors.