Granger, IN - Cash Out Flip Loan

[Dustin Lauer]

Investment Info:

Single-family residence private money loan investment.

Purchase price: $216,000
Cash invested: $225,000

Quick cash out loan of an in progress rehab project at 9.999% and 2 points.

What made you interested in investing in this type of deal?

Clients paid cash and wanted cash out to buy another investment property all-cash.

How did you find this deal and how did you negotiate it?

The owners of this property are the sellers on another deal that our company is financing. They mentioned they could use a loan themselves so they could close cash on another deal and this property was purchased for a great deal, so we're happy to offer a quick loan with minimal paperwork needed from the client.

How did you finance this deal?

Capital was provided by Fidus Fund I, which is our own fund. The Fund is a 506-C Reg D private placement funded by accredited investors looking for higher yields diversified across assets and loans.

How did you add value to the deal?

We ran our own comparables sales research through tools online.

What was the outcome?

We'll see, but our guess is the clients will pay off our loan this summer with a healthy profit for their efforts!

Lessons learned? Challenges?

Challenges certainly exists with rehab deals already in progress, which is why most lenders won't touch these loans. Our company was happy to get our hands dirty and dig into the underwriting to make it a smooth process for our clients.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Meridian Title in the greater Michiana - MSA has been great to work with. We closed this one with Ms. Amy Everett in their Edison Lakes office, nearby subject property. Very professional and knowledgeable.