All Forum Posts by: Nick Webb

@Nick Webb My smallish regional bank loves to do these types of loans locally.

If I were you I would make a list of what you’re looking for and start calling the local banks/credit unions.

Just so you know on my newest purchase I am looking for renovation money as well as financing and the bank is looking for formal quotes as to the materials needed and the amount/cost of the labor that will be involved.

I had just said that we expected it to be about $110,000 and they were like “No we need a formal estimate”.

To get long term financing you have to be somewhere in the 75k range on loan amount . Theres maybe 1 or 2 funds that will purchase loans down to 50k . hard money is an option . What is the full scenario looking like ? 

Hey Nick,

Definitely have to either work with a lender who does single asset at/below that number, or do a portfolio with a few others in the same amount. 

You should still be able to find a few lenders to do smaller rehabs like that, as long as the ARV supports it, and often times the BRRRR tends to work better that way because if it is in a good Sec 8 area with rents that support the ARV, the refi can work out well.

Happy to connect and talk through details if you are interested!

Traditional lenders may not show much interest in these lower-value properties. Hard money lenders, familiar from your experience with flips, remain a viable choice, although they typically come with higher interest rates and shorter repayment terms. Another avenue is portfolio loans, tailored for those with multiple properties. Government programs like FHA 203(k) can assist in purchasing and renovating homes, but certain regulations apply. Once you stabilize the property with a tenant, you may explore a cash-out refinance to utilize the increased home value for additional renovations. While it requires careful consideration, delving into these alternatives can pave the way for successful investments.

To get long term financing you have to be somewhere in the 75k range on loan amount . Theres maybe 1 or 2 funds that will purchase loans down to 50k . hard money is an option . What is the full scenario looking like ? 

Quote from @Nick Webb:

How do you finance Buy and Hold real estate under $85,000.00? What If I am able to get them tenants stabilize, will they lend for me to renovate them? I've used hard money for larger flips, but for stuff that makes sense for a buy and hold. How do I get the long-term financing and the money to renovate to make Tenant ready? can anyone recommend a lender?

As mentioned by others, it is generally done in two parts. A fix and flip loan to purchase and rehab and then refinance into long term loan post-rehab. For a fully stabilized property, there are outlets on smaller loans, but, very limited in the space. We do properties 75k plus in value, but, it’s a niche market with little competition at those loan sizes. 

Hey Nick,

Definitely have to either work with a lender who does single asset at/below that number, or do a portfolio with a few others in the same amount. 

You should still be able to find a few lenders to do smaller rehabs like that, as long as the ARV supports it, and often times the BRRRR tends to work better that way because if it is in a good Sec 8 area with rents that support the ARV, the refi can work out well.

Happy to connect and talk through details if you are interested!