Financing the first "investment" property

[Sharee Mason]

All of my previous investments have been financed as primary residences, because I lived in them first and then moved and rented. This time around I am wanting to purchase an investment using a loan (I have always used VA in the past but was told I cannot use it for an investment), and my lender is telling me that I need to put 15% down (19k in my case). I told her that I plan on using a hard money lender and that I'd get back to her, and she replied that I am not allowed to use "gift money" for the downpayment. Am I missing something or does she just not know what hard money lending is?

[Rick Stein]

You must ask him what his terms are. Generally, hard money is expensive, (i.e. 4-5 points and 12-15%). But, maybe he would do less. Also, if he is an individual and not an institutional hard money lender, he could make up his own terms. In this case, it would be "private money" He might offer you 100% financing for part of the equity if the LTV is low enough (generally, hard money lenders do not want the total loan, acquisition and rehab to exceed 65%. The point is to be creative.