All Forum Posts by: Account Closed

Other than that, I don't know why you'd want to bring in a HML.

Transactional funding is usually a bit cheaper than standard hard money rates.

@brian sigmon There are a couple of things to consider here. First, if you're buying the place for $200k and not going to put any rehab into it yourself, you will likely be looking at a $150k loan and bringing $50k to the table (75% LTV). Second, if you purchased it with hard money, there would be no contractual rights to convey. You would own the property and would convey title to it. Plenty of wholesalers do it this way - they close on the property and spend a few hundred bucks cleaning it out and then they can have as many people inspect the house as they want without the seller objecting, etc. However, you would then be selling your house, so there would be two sets of closing costs involved and you would have to figure out who all is paying them (the seller, you, the buyer, or a combination). Third, it sounds like you made an offer that wasn't accepted by the seller, so I doubt you have anything to convey at this point, since you said the seller insists on $3,000 in EMD. You could put that on the line and try and assign the contract, but the seller is apparently (and smartly) keen to what you are up to. That would be your risk to take. Finally, I'm assuming this is your first hard money loan, so you'll probably pay 3+ points ($4,500) and fees ($1,500+) and at least a month's worth of interest ($1,500+). I would ask myself if I could get much more than an extra $7,500 in profit by closing on it myself and then reselling it, and if not, it makes sense to get it under contract and assign.