All Forum Posts by: Mark Safrin

Will the rentals more than service a 30 year fixed, fully amortized loan at around 8% interest? If yes then this Hard-Money-refinance-option might be worth considering. There are no limits to the number of such HMLs I can loan.

How much longer will the rehab take? How much is it likely to be worth As-Is? What interest rate are you paying?

I must say, I absolutely love how you ended the extremely passionate and opinionated views you espoused with a call for a dispassionate debate. :) 

If you don't like wholesaling, the last I heard this is a free country. You are not an indentured servant. Find some other business activity that you actually enjoy. 

If you have a different business solution than HMLs that is workable for specific investors, then by all means dispassionately advise them. In fact why not make a name for yourself here on BP due to your sagacious, dispassionate advice? 

As it happens, why not quietly read post after post right here in BP of successful flips that used HMLs very successfully? You might pick up some tips from your quiet reading that allows you to become one of those successful people one day. Why not quietly read about numerous investors who wholesaled for a while to build up a stake and then jumped into the fix and flipping or BRRRR game?

PS. I'm pretty sure links are not meant to link to the very same post you are posting. Just sayin'.

Wishing you the very best in your career.

I  think you will find that if you can put some sizable money down as opposed to asking someone to fund 100% of your purchase, you will receive loanoffers rconsiderably better than 15-18% interest only. 

I assume there were hefty points too. And just maybe the property title will be placed in an LLC that you can be kicked out of the moment you don't cough up those hefty repayments?

Come with some money down, have some skin in the game and HMLs will be merely expensive instead of exorbitant. 

Just noticed this thread.

A HML is used when a conventional loan is not available or not desirable for you.

It will come with a high interest rate, points (which means percentage of the total loan amount to be paid to the lender at closing) and often other fees.

An LLC is usual along with your personal guarantee. We for instance will allow a loan with just you as an individual and not an LLC if you like - but expect a great deal more due process while we background check you with a microscope.

As others have mentioned, most common is a short term HML to secure the purchase long enough to rehab if necessary and then refi to a conventional loan. We, for instance, do however also offer a 30 year fixed, fully amortized loan for people who want a long term HML purchase or refi loan. However it is still a HML loan which means higher interest rates and closing costs than conventional 30 year fixed, fully amortized loans.

Best wishes. 

Is your purchase covered by another loan? If so, a HML is unlikely to lend because we want first position lien against the property.

If not, why would you want to borrow rehab money only? If you can get upfront money from a HML, why would you want to receive rehab money that is tied up in escrow until you complete rehab milestones but are still paying interest on from day one? Get a purchase loan and use that money to rehab. Rehab money is usually when you need extra on top of the purchase loan.

Asking for your SSN is pretty standard. And a copy of your ID. And if you are not a US citizen, your Green Card. And if you are also asking for a preapproval letter, for what that's worth, we want a copy of your bank account statement.

Your SSN will be used to hard pull your credit score. It will also be given to the Title company for your loan.

If you are concerned about identity theft then consider asking others in the real estate investing world that you know, for referrals to HMLs that they use. We for instance get a lot of referrals from people who have come to know and trust us.

Cheers. 

Monday morning I plan to raise this matter with our usual appraisal AMC to discuss/find out their guidelines with the appraisers.

Whatever happens, any loans requests we suspect come from this group will only be appraised with our appraisers and our appraisal requests will have capital letter comments probably like: "STRAWMAN PRICE FIXING SALES SUSPECTED ON PREVIOUS SALE(S)".

Cheers.

I am wondering how you approached 30+ HMLs to receive little or no response. If it was something along the lines of "I have no money for a deposit or loan costs and no investment property experience but give me 100% of the money I need to purchase an investment rental property, I"ll pay you back I promise", then I suspect I've spotted where the issue might lie. And, I'm sorry to be brutal here, it's not with the HMLs. Hard Money Loans have many advantages but cheap they are not.

If you cannot raise conventional loan funding but have money for a deposit and loan costs then the logical source of funding is a Hard Money Lender. 

Of course you also need an exit plan - be it fix and flip, stabilize (e.g. BRRRR) or whatever. You still need to pay off the loan.