All Forum Posts by: Katie Smith

Hi Stacey! Transactional funding definitely seems like a powerful tool for quick flips. I’m curious—how have you found the costs associated with this type of funding compared to traditional hard money loans? Are there any specific scenarios where you think transactional funding is more advantageous? I'd love to hear about your experiences or any tips you might have!

Hi Tracy! It's great that you're looking to move away from the uncertainty of ARM and balloon loans. Long-term stability is key, especially in real estate. I'd recommend exploring options that allow for refinancing into fixed-rate loans, which could offer the predictability you need. If you're navigating the markets in MS and TN, I have some experience in those areas and can provide insights or point you in the right direction if you need it. Happy to help with any questions you might have!

Hi Shane! Sending you a dm! I can go up to 80% LTV on cash-outs and can do non-warrantable condos as well.

Hi Michael! 

First-time borrowers should consider their creditworthiness, as it directly impacts loan terms and interest rates. It's also important to evaluate different loan options, such as conventional, FHA, or hard money loans, to find the best fit for your investment strategy. Ensure you have enough reserves for unexpected expenses, and understand the property's projected cash flow to avoid overleveraging. It's also crucial to have a clear exit strategy, whether that's flipping, renting, or selling. Lastly, choose a lender who is experienced with real estate investments and can offer advice tailored to your needs.

Hey Kristie!

Securing private funding can be challenging, especially when you're just starting out. To overcome this, you can focus on building strong relationships with potential investors by attending networking events and sharing your track record. Make sure to present detailed and transparent deals, emphasizing the benefits and exit strategies. If you're struggling, consider offering higher returns initially to attract investors, or partnering with someone who has a solid reputation in the industry. Persistence and trust-building are key!

Hey Joon! I have a few different options that will allow you to go down to $75K. Happy to help! I'll send you a dm.

Hey Alex! 

Connecting with other wholesalers is a great way to learn the ropes and find leads. They can share strategies that have worked for them, such as driving for dollars, networking with real estate agents, and leveraging direct mail campaigns. Building relationships with experienced wholesalers can also open doors to joint ventures and off-market deals, giving you a head start in the industry. Networking is key in wholesaling, so don’t hesitate to reach out and collaborate.

Welcome to BP, James! If you're ever in need of financing for an investment property - lets connect!

Hey Haley! 

It’s great to see your enthusiasm for diving into real estate investing and flipping houses, especially with your experience in home improvement and remodeling.

You raise an excellent point about using your own cash versus financing through hard money loans. Here are a few key considerations to help clarify why many investors opt for financing, despite the risks involved:

1. Leverage: Financing allows you to leverage your capital. By using a hard money loan, you can take on multiple projects simultaneously rather than being limited by the amount of cash you have on hand. This can potentially increase your overall returns, as you’re not tying up all your capital in a single project.
2. Cash Flow: Using financing frees up your cash for other investments or opportunities. This means you can diversify your investments rather than concentrating all your resources in one project. Even if you’re making interest payments, having liquidity can be advantageous in a dynamic market.
3. Speed and Scale: Real estate deals often require quick action. Hard money loans can facilitate faster closing times compared to traditional financing, allowing you to secure and renovate properties quickly. This is particularly important in competitive markets where speed can be a key factor.
4. Risk Management: While there is certainly risk with any form of financing, careful management and choosing the right lender can mitigate these risks. Hard money loans are often short-term and designed for projects with a clear exit strategy. Additionally, successful investors typically build a solid network and due diligence practices to minimize potential losses.
5. Reinvestment: Using financing means you can reinvest the profits from one project into multiple new ones, potentially accelerating your growth. Reinvesting your profits quickly can lead to a compounding effect on your returns, compared to the slower growth from reinvesting your own cash after each project.
6. Opportunity Cost: By using your own cash, you might miss out on other investment opportunities or market trends. Financing allows you to diversify and potentially capture more opportunities within the real estate market or other investment avenues.

That said, it’s crucial to do thorough due diligence and understand the terms of any financing you consider. Working with a reputable lender and having a solid plan for each project can significantly reduce risks.

If you decide to use hard money lending, it’s important to calculate your costs and potential returns carefully and ensure that the projects you undertake align with your financial goals and risk tolerance. Every investor has a different strategy, and it’s about finding what works best for your situation.

Hi Spencer! Look into a DSCR loan for your rental! You'll be able to get up to 80-85% LTV. Since you've owned your other rental for 4 months - you could also look into doing a cash out refinance to help you acquire this one.