All Forum Posts by: Account Closed

@Luke Saglimbeni

That is a good thing to know. A lot of people forget to look at the potential risks with borrowing money, whether it is more expense than calculated, or penalties for things they didn't know could happen. Thanks for letting us know. HELOCS are a great option as well definitely!

@Jeshua Patrick

Thanks for sharing the experience. I love when people try something new! and thanks for including the ups and the downs of it. 

@Lori Greene

Thanks for sharing! Why is private money your favorite?

@Eric Drum

I forgot about that option! What is the process for taking the money and returning it to the Life INS policy?

@Wale Lawal

I only used one myself, they were a local company called MB Capital. I met them a local REIA in NJ. I'm sure that a few other people could recommend some places as well.

@Charles J English

I'm glad this post has been helpful! Good luck finding your first deal!

@Melvin German iii

I'm glad this post helped you find some options you may not of know about. Definitely make sure to reach out to some of the people that have contributed to find out more about any topics that interest  you.

@Leon Yin

Hard money is essentially a company that is lending private money. They find people with money and put them in a pool for them to lend to investors. They have high rates because of the risk involved with their loans, rehabs and distressed properties. The rates I have seen have been usually between 10%-14% with 1-3 points and anywhere from 0%-20% down. They will usually lend from 70%-90% or the ARV but sometimes will do 100% depending on the program they are offering. Experience is a key in helping you get a better rates. Hard money can be good to use because it is easier to find and get most of the time. The question is can you afford it.

For private money the key is to get a lawyer experienced in writing notes for investment properties. He can draw up the mortgage for you. you also want to usually do a JV agreement as well IF the person is getting anything beyond just a regular lender, EX spilt of profit. Also make sure it is extremely clear what everyone is doing and responsible for and what is expected, this helps with miscommunication problems if something went wrong, EX longer hold time etc.

Hey @Divya R.

My main recommendation would be to base your choice off of how you plan to invest. If you are looking to do one project at a time then I would recommend finding one really good GC that you can build a relationship with. If you are looking to invest in rentals that would only need on going to minor repairs I would say build your list of sub contractors (plumber, handyman, vac, etc) it will be more cost effective for you with small projects. If you are going to go full tilt with rehabs big and small there are two key ways most investors will set it up, and its based on personal skill and preference I think. One they will hire a Project manager or a GC company that can handle all the projects for them from beginning to end, this helps them focus on finding more deals and funding them. Another part of the first one would be to have a few GC's thing here is you have to manage more people. Downside of this one is it can cost more but you also save your own time. The other option most do is Find their own team of subs and manage them. Saves money but they also have to spend a lot more time managing them. 

So in the end it comes down to your plan and strategy for investing and what do you want to do in it.

@Michael Weiss

Thanks for the info, It is definitely a great way to use money for an investment!

@Mindy Templeton

That is a great use of discipline and initiative. It' was a great way to build a rock solid foundation! Thanks for sharing! The creative part is so important in financing. Same to you with great success!

@Samuel J Gonzales IV

@Jeshua Patrick is right about the cc money. It is a viable option but you need to get it off the card as cash to be able to use it and then need to make sure it is usable for that particular loan. Hard money and private lenders won't care as much as a bank may. So using a different loan in-conjunction with the card would potentially work. A few people above have posted different ideas as well and definitely know more about it then i do. 

@Nicole Parnell

Thanks! It definitely went better than I thought. Thanks for going over the time limits for the FHA 203k as well. I didn't know you could avoid the tax on profit by waiting an extra year! good to know thanks!

@Jobee Vincent Buenaventura

Starting with a full rehab can definitely be difficult if your just starting out. There are a lot of moving parts and the hold time is always longer than you think. However if you have an experienced team it can be done.

I absolutely agree about hard money not being good on this of deal though. For all the points that were previously stated. I would recommend private money or a money partner on this one so you can negotiate a better deal, ranging from better rates to possible hold off on payments till the end.

[Solicitation Removed by Moderators]

@Caleb Palladino

It Can definitely be difficult to get a contractor to go through a property. A lot of the reasons people have given above are the reason. Finding the right investment friendly Contractor is what you need to do. They will better understand how to work with An Investor so it makes sense. I am a contractor in New Jersey, New York, PA, Delaware area and I work solely with investors. So everything I do is catered to working with them, walking projects Before they get them (sometimes 10 a day), having detailed scope of works so they can know what their line items cost, and having a way to communicate the entire project with the investor so they can follow along and know what’s happening every step of the way.  where is the project you were looking for bids on?

@Michael Weiss

Edit for that last one being not “double chin” lol but never used a 401k

@Michael Weiss

That's awesome! I have a double chin was with using 401(k) or iras Could you tell me more about how that process worked for you? What kind of 401(k) or IRA did you need, what were some of the guidelines, some of the hurdles, etc.?

@Rob McAllister

Glad it was helpful! Definitely put a list together I learned some more about financing myself as well!

@Jay Anderson

The money when you take it out can be hard to shift around if I remember correctly. It is probably the bank more than the card money though, or the way you took it out maybe? I’m sure one of the previous people in this post would know better.

@Noah Mccurley

Im glad that it has created such a discussion. I would say that the type of lending I use depends on the type of deal but I would mostly use private money for flips and when I get into rentals I will probably use small banks with a strategy of using their rehab loans to get in then refinancing with them. This way I can build a relationship with them to get more loans at better rates and open up solid possibilities of financing.