All Forum Posts by: Shawn McCarty

Hello Charles,

I have thought about and exhausted all other options... hence why I am using what I consider a last resort. Any suggestions?

@Stone Teran

Thanks for the reply. I was thinking somewhere in the range of about 10K like I said... then once discussions went further it seemed like things changed.

Did you get all of the money upfront?

Hello,

I spoke with a hard money lender who said... "we lend based on the property, 67%, 4 points, 6-12 months, 14%"...

I say ok, I think I can come up with say 10K to get "skin in the game" which should cover the 4 points easily on the type of deal I am looking at. I move alone with the process and next I get this info...

"you must come up with 10% closing (do they charge a premium here because they can? - I have never paid 10% closing or near that on any house I have ever purchased), you must have enough money to begin interest only payments, you must have enough money to start construction before you will get any construction money"

I am accountant, so I understand numbers pretty well... on a 130K loan you're looking at about 30K out of pocket maybe more... I guess I am just not seeing that point in a hard money loan where I am coming up with 25%-35% out of pockets...

Any help, anyone?

@Jeff Wallace,

I completely agree I would potentially have money in my pocket. But, with that strategy how long does it take to build a portfolio... you know what I mean? Buying one buy and hold at a time... hard money refi's... again... tons of loans... long periods of building a portfolio... longer periods of having the portfolios paid off... just my outlook, once again... could be looking at it wrong.

thank you,

Shawn

 Jeff,

That's my problem... I don't understand the exist strategy... Reference my comment above about refinancing... 

Hello Jeff,

I am looking total purchase and rehab in the 30K range... possibly up to 50K. I could not qualify for a personal line of credit for that much. I will be honest around here I don't know people who could. Unless I am misunderstanding you.

Thank you,

Shawn

Hello Ryan,

I am not at all familiar with portfolio lenders. How does a commercial loan cover residential investment? Also... what is the lending criteria on something like that?

With the hard money reference... Lets say I do 50K hard money total (4 points out of my pocket at 2,000)... Loan terms are 12 month... I complete the work in 3 months... get a renter in month 4... I have them rent for 6 months... Then what? I go to a bank and say.... lets refi? They say ok... house is worth 80K you need 20% down... so that's 16,000... I am into the hard money guy for 50K, out of pocket 18K... I get 80K from thank... 50K to hard money guy... plus my 18K... I have 12K left over in my bank account right? AND I am still into the bank for 80K... right?

I am probably missing something... Could you help me out please so I can understand?

thank you,

shawn

Hello Ken,

Not very familiar with this... Could you explain more?

Hello Everyone,

Took some time away from focusing on becoming a real estate investor to get some things straightened out in my person life... I am BACK! smarter and more determined than ever!

So I am thinking about picking up a buy and hold in the Dundalk area. Any general thoughts right off the bat?

So my main question is this... If I do hard money to get a buy & hold (including the rehab costs).... What do I do next? Obviously I need to Refi right? Any it has to be conventional right?

Thank you,

Shawn

Hello,

I am trying to pickup my first buy & hold (first real estate investment period)... I have some potential properties, I have some people who would lend hard money based on the deal alone. My only problem is this... Once I buy the house and put a little money into it... What next? At that point I would be in 4 points (not much total based on the properties I am looking at)... and I would have 12-14 months to pay back the hard money... Do I refi conventional? If so, how can I really amass a portfolio doing it that way? I would have a million loans in my name... is that even possible?

Thanks everyone in advance... Biggerpockets has also been a big help in the past!

Thank you,

Shawn - The Newbie!