All Forum Posts by: Herbert Cuthbertson

@David M. - Thanks for your response and yes you are correct. I was overthinking it. Your answer helped clarify it. I was unsure. That was the reason I asked. Thank you for the information, it was very much appreciated.

@Wayne Brooks - I'm learning Wayne. I WILL get it right. I appreciate your response, its fuel for my motivation to learn more on my own. Thanks for your response. 

Hello everyone, I have a question about a property that I'm hoping someone can clarify for me please. I have property close to being under contract (seller has contract being looks over). The property is paid off but the seller has an line of credit lien on the property. I'm trying to understand this particular process of hard money.

Will any Hard Money Lender approve a deal with a line of credit lien on the property? 

Secondly, if so, how does that work?.... For example.... If I'm purchasing a property for $100,000 and it has a $30,000 repair budget. Hard Money Lender lends me 70 percent of the ARV ($250000) equating to $175000 and funds 100 percent of the rehab ($40,000) which will come out to a hard money loan of $215,000. (Mind you I didn't extract any fees, down payment or points as this is just an example)

Having said the above, the seller has a lien on the property due to a $25k line of credit. Will the HML pay off this line of credit, freeing up the title, then take a 1st position Lien, and give the seller the remaining balance of $75,000 from the original purchase price? If so, will the seller be paid once I close the financing with the Hard Money Lender? Or will they get paid once I rehab and sell? I'm guessing it won't be the latter because of the length of time. Can some folks please chime in and let me know in order save me some potential issues about not only if the lien can can be satisfied by the lender but also if so, if the seller will be paid. I really appreciate the comments and thank you very much in advance. I'm continuing to learn a great deal scrolling through the many forums on this site.

Luciano, thank you for the advice. It's much appreciated. I will search the site for that document. 

After much research about real estate investing and constantly on this site for the great information it contains, this is my 1st post which I'm sure will be among many in the years to come. I need some advice. I recently received a list of items to produce to a potential HML. One of those is a Purchase Agreement for Property (if purchase). How do I obtain this? Property is in Kentucky, off market and seller is a former neighbor of mine who is willing to sell the property to me. Is this something that is available online? Do I need to get real estate lawyer involved to obtain this purchase agreement? Does it need to be notarized with both of us present? How do I go about obtaining this document?

 Thank you in advance for your input on this.