All Forum Posts by: Dan Colantonio

@Dan Colantonio Good question. I have never done a deal without having adequate cash reserves on hand. If I were using your proposed strategy and I thought the flip would cost me 50k, I would have 75k on hand (a 25k buffer). If I thought it would take me 3 months to turn around, I would underwrite for 6-9 months just in case. I am considerative, but I believe preservation of capital is always #1. Best of luck! 

@Dan Colantonio you definitely want to complete the rehab as quick as possible to minimize the length of your hard money loan due to the high interest rate- too your point. With my particular lender there was no pre payment penalty so I could pay him off in a month if possible but I had up to 12 months.

You’ll want to renovate and rent out at least 1 unit ASAP so you can start having income coming in to cover your interest only loan. So in my rehab I focused primarily on getting the first unit ready for rent before moving on to the second.
This will buy you enough time to shop around for lenders for the refi. Although as many have pointed out In previous forums, you should have already done your homework and have a REFI lender lined up. 

The hard money lender doesn’t care what you do With the asset as long as they continue to receive their monthly interest. Whether the money comes out of Your pocket or your tenants... it’s all the same to them. Hope that helps Clarify some things.