All Forum Posts by: Arron Paulino

Congratulations on getting started in the rental world. If you’re trying to operate your portfolio from far, I really don’t see this being sustainable. I would partner with a management company that can be your eyes and ears locally. Some can help refer you to lenders and contractors. 

@Arron Paulino

The more experience and pipeline of deals, the better the terms. It will be important to cross the threshold above 5 and show your exits. But if your deal is in a solid metro, the deal + rehab pencils and you have credit 700+ and liquidity private money is available.I'd love to talk more, Sending you a DM.

@Arron Paulino

The more experience and pipeline of deals, the better the terms. It will be important to cross the threshold above 5 and show your exits. But if your deal is in a solid metro, the deal + rehab pencils and you have credit 700+ and liquidity private money is available.I'd love to talk more, Sending you a DM.

@Arron Paulinofollowing !

Thank you for sharing your experience and your goals for expanding your real estate portfolio. It's a smart move to explore fix and flips for generating additional income and gaining valuable experience in real estate investing.

Regarding your question, yes, your experience can certainly play a significant role in improving the terms, leverage, and rates you can secure from hard money lenders. We are a bit different, as we recognize the value of your expertise and look beyond just the last 3 years for qualification.

Notably, we also take into account your rental experience for qualifications on fix and flip loans, which is unique in the industry. Your ability to manage rental properties successfully can enhance your profile and potentially lead to more favorable terms. We believe in tailoring our lending solutions to your individual circumstances and leveraging your skills and history as an investor.

Feel free to reach out, and we can discuss how your experience can work to your advantage when it comes to your fix and flip ventures. We're here to support your real estate goals and ensure you have the best possible financing options. Looking forward to helping you succeed!

Typically you will see an increase in leverage & decrease in rates after you can show 3 completed rehab projects. Hard money terms are almost always based on prior experience.  @Arron Paulino

 Hard Money lending does get better with more volume. Points, and fees are definitely going to be better at higher volumes and loan amounts. 

Rates are largely dependent on the current climate, your experience in the last 36 months either buy and hold or flip, and your FICO score. 

@Arron Paulino Every lender is different, but I have found two general trends hold:

1. Rate is either fixed by the project type or is dependent on credit score. 

2. Despite this, the more deals you do with a lender, the higher leverage you get and/or the more you're able to negotiate or reduce origination fees.

So, overall, terms get better through scale, but usually not through the base rate (though there are exceptions). If you would like me to help you find a lender that you scale with, I would love to help out.

The three ingredients for scaling:

1) Inventory - need projects to do

2) The right team - need good property finders/analyzers, even if that's you, you still want others

3) Money - This is where Hard Money comes in.

Yes, terms will get better for most lenders as you go.  Lenders have what they call "buckets" or "tiers" that classify investors by the number of projects completed last 3 years.

I get people started all the time, which is the hardest one to do, the first.  One of the areas I concentrate on most for my clients is scaling.  I help provide 1, 2, and 3 on the list above which then allows the investor to be in a safer, more profitable environment which in turn allows for scaling.

Cali is a very expensive market and the contracting cost and timeline are murder I hear.  What I do is stay between the Ohio Valley and the Rockies.  I can create networks there where people have a chance to "get in" the game.  I'm in the middle of two first deals for BP members here.  My team found them houses for 50k - 60k that need 40k in rehab and will sell for 160k.  After everything is said and done they will walk with 20k net in about 3 - 4 months.  Not bad for a first one.