All Forum Posts by: Kerry Boyle

 In NJ, the answer is probably the second one. Houses sit vacant for a long time in NJ (vs other states) - this causes issues that most traditional banks will want fixed prior to closing. You don't want to fix up someone else's house. So figure out a way to buy it, fix it, then you can sell, rent, or live in it.

However, traditional banks won't dismiss lending on a property solely because it is a foreclosure; they would dismiss it because of bad condition.

 There are levels of hard money. Think about it as risk vs reward for the lender.

• Your local millionaire might be really easy to work with, provide no more than 65% ARV and charge 14/4. He is able to charge 14/4 because there is no lengthy paperwork, if your deal is good enough you don't have to put any money down, and while it may be expensive, you know he will be there with you at the table for closing.
• Then you have your nationwide lender that offers 7-10% rates with 2 or less points. Typically, this requires more documentation - credit becomes a concern, assets may be a concern, your experience might help them. You might get more funding, but the deal is much more secure because the lender is not only vetting the property, but also vetting you as a borrower.

Of course, there is everything in the middle, even more in each other direction.

My point here is, that each of these lenders will "qualify you" in some way. My company typically requires a credit check and verbal agreement to terms. Nobody wants to waste time - for example, you shouldn't put offers on a commercial property if your lender only lends on residential properties... etc.

Ask your lender directly how they verify assets and whether you could use a partner for funds. Each lender is different.

Residential Investment Lending at its best. 

We finance fix and flips, cash-outs, refinances and make it all easy for you!

Requirements:

• Applicant must have 600+ credit
• Applicant must have clean background check
• To close in an LLC/Inc only
• Guarantor/applicant must be at least 1% member of entity
• Must be U.S. Citizen
• Yes! You do need some money to close! At minimum, closing costs and first 3 payments*
• If you are doing rehab, you need a licensed and insured general contractor.
• You must make money on your flip - we will vet the project and feel confident you are making at least 25% of the repaired value on a sale, prior to sales costs.

Why are we great?

• Excellent service - it matters to us.
• We advance your rehab draws. That means you get the money prior to completing your work!
• Quotes are free. Term-sheets are free. I don't need your social security number to give you an idea of what your loan will look like!
• Our processor will coordinate with title, your homeowner's insurance agent, and your general contractor to ensure we have what we need to close your loan. 
• You don't need to call a robo-call queue to get us. Most loan officers have a direct line and work outside normal business hours.

What do we need for a quote?

• Estimated credit score - be accurate, your loan estimates depend on it!
• Experience - If you (or any members of your entity) have owned and sold properties in the past three years give yourself a point. Likewise any rental properties that cash-flow also give you a point. Add them up and let me know the number!
• Purchases - Purchase price, rehab cost (if applicable); After-Repaired Value.
• Refinances/Cash-out - As-is Value, rehab cost and After-Repaired Value (if applicable), and any debt owed on the property; Also, what is the term you want? 6-months through 30 years**.
• Entity name (you can say "none" yet if you don't have one!)

*Refinances/cash-outs (with or without rehab) typically don't require cash-to-close.

**30 year programs require more information - please email me if you are interested.

We work with beginners, brokers, and professionals. Shoot me an email with any questions!

I hear you about the 60k is all he needs. He would still need to pay closing costs and we require a full term interest payment escrow on "refinances/cash-outs" which is essentially what this is... it might not be necessary depending on other factors but I tend to be conservative until I know more details.

Also, the cost of writing a loan is the same at 60k as it is at 2M and 75k is our rough break-even. Which means anything under 75k just pays more in interest/points to make up the difference. In other words, a 75k loan with equity paying closing costs/prepays will cost him the same as a 60k loan with him paying closing costs/prepays.

Please have your friend shoot me an email or give a call.

We would lend on this. Does he currently have it in an LLC? He can get 15k based on the as-is value (as long as it is 20k or more) to cover closing costs/interest payments and anything else. The 60k would be rehab holdback - except for the first draw of up to 15% of as-is value. We lend up to 75% ARV... sometimes these sound more confusing and can be cleared up easily with a phone call.

I imagine you have the experience to support the requests. I understand it isn't always easy finding private money, especially with the values in the DC area. 

I am probably better than your current HML. Can do 100% of purchase at settlement, but rehab is going to be held back (we won't give you 500k and pay 200k for the property for instance). The structure is 90% of purchase and you get 10% of purchase from your rehab portion. You pay 3 months of interest at close to cover the first 120 days of payments and whatever non-purchase closing costs (title, recordation etc). We will advance your rehab draws so you don't come out of pocket.

I suppose I can crank the interest up high enough so I don't have to charge points, but that would be cost prohibitive to you. $970 in all the junk fees.

When you find the private lender, switch out. At least you get a better deal now.

Hello @Karen Wilson,

From what I have seen, foreign investors usually get reduced LTVs and/or less desirable programs in general. This may not always be the case, but you may want to consider getting a partner with citizenship. Carefully weigh the benefits and costs and pick what is best for you.

For example, you may pay a part of your proceeds to a partner and that may be OK if you are able to get more financing on the front. Alternatively, you may not need the added financing (or found a very foreign-friendly lender) a partner may be able to get you and can therefore save the cost of paying them at the end.

Best of luck! Keep us posted on who you found and what the deal looks like. 

Hello @Jonathan C.

Are you guys doing a project on Girard St currently? I think I saw your sign in front of a property. Looked like a great spot. 

If you area ever looking for a different hard money source or referral opportunity give me a call or email. We do some interesting things that other lenders won't do.

"I would like a loan for approximately 1 year, or short, or longer for the needed funds of $140,000 to close plus another $60,000 to be a second loan taken out after closing. Total loan amount is $200,000."

I am confused about this part. Why not just get a 200k loan? Why separate into a first and second... surely that is harder to find. 

At 50% LTV, I could probably close subject to an appraisal being ordered (prior to receiving it) and call $60k of it rehab money that we fund at closing. I could beat the pricing, but like @Jay Hinrichs says, fast and cheap are usually at odds. If I charged 10/2, you would save $6k if you kept it for a year; $4k if for 6 months. Closing in 5 business days is a lot of work and coordination.

If you happen to have an appraisal, I am game. Otherwise give me a call to see if it is worth the fight.