$1.5M in 2 Months?! Thanks BP!!!

[Wendell De Guzman]

We just put up our HARD MONEY LENDING business and in just 2 months, we made over $1.5 Million worth of loans. I attribute at least 50% of that amount to borrowers who are members of Biggerpockets. Thank you @Joshua Dorkin!

I've said it many times before and I will say it again - BP is an awesome community. But for you to get noticed and get the most value out of this community, you should provide value through actively participating in the forums & blogs. Look for people who have a high ratio of votes to posts (e.g., 1000 votes to 1200 posts vs. 10 votes to 1000 posts) and do what they do.

Talking about providing value, here are the TOP 10 THINGS YOU NEED to get your hard money loan application approved: (arranged in a "countdown-manner")

10. You need to get your financial and LLC documents in order (tax returns, bank statements, proof of income, incorporation documents, etc). Any lender will ask these documents so organize them now even before you need a hard money loan.

9. Learn how to make a PERSONAL FINANCIAL STATEMENT (Assets and Liability statement, Income & Expense, Cashflow) or have a CPA make one for you and show it to your lender. The more the lender can see that you have a positive net worth, preferably very liquid, your chances of getting a hard money loan is very high.

8. Put together a RESUME of your real estate experience. Even though we provide hard money loans even to newbies, I feel more comfortable lending to people with real estate experience, preferably those with rehab experience. In your resume, you can put pictures of before and after renovation, as well copies of your HUD-1's showing you've profited from a fix-n-flip before.

7. If your resume is thin - meaning you're a newbie and not very experienced, get experienced teammates and show their resumes to the lender. For a fix-n-flip, you need to get a good real estate agent to sell your flips (get the one of the top 10 selling agents) and a good experienced General Contractor. If you're experienced, showing your lender your team's resume will still help.

6. Get the most recent copy of your credit report. Sometimes bad things happen to good people resulting in them having some dings on their credit. But if you can show that you have been paying your bills on time for the past 12-24 months, chances are good the lender will overlook that ding or two on your credit that happened 5 years ago.

5. Get a good real estate agent (your buyer's agent) to do a GOOD CMA (Comparative Market Analysis). Include SOLD and ACTIVE listings COMPARABLE to the subject property in a half mile radius, sold in the past 6-12 months, in a 0.35-0.5 mile radius from the subject property.

4. Get a DETAILED SOW (Scope of Work), broken down line item by line item with separate cost for materials and labor if possible. Having a good GC will be crucial for you to do this.

3. Fill up the Loan Application COMPLETELY and HONESTLY. Don't HIDE anything from your hard money lender or from any lender for that matter because we will find out anyway.

2. Get a SIGNED Purchase Contract (signed by you, the buyer and your seller) - yes, hard money lenders need you to have the deal under contract before they can lend you money. Hard money lenders prefer that you buy the house in the name of a legal entity (an LLC or corporation);

and

1. Present to the lender a spreadsheet showing your PROFIT PROJECTIONS. If the lender sees that you know what you're doing, chances are good you will get your loan approved. You need to know your numbers even before you put the property under contract anyway. If you don't know how to run your numbers learn it first. You should have a spreadsheet that looks like below:

So there. Hope this "Top 10 Things countdown" will help you get your hard money loan application approved. 

And I hope this post will also inspire you as well to be more active on BP (which I have not done lately since BP has provided me so much business - both in real estate and now in lending) so that you too will generate business because of it.