., you do need equity of 25-40% higher with less experience, and to elaborate on the financing terms from the Hard Money Lender, they’ll generally charge “points” percentage points on the entire loan, say 3% upfront and then interest on the money as you draw it out.

Here's a drawing I shared with my friend who's an accountant, (hopefully it makes sense lol) So it's best to go with option 2?

My question is how do I handle the draw?

When you need construction disbursements you apply for a draw and they wire it once proof of hitting a milestone is provided.

Few dimensions:1) Most employees are not skilled at drawing a hard separation line between the so called “W2” job and the “side” job.

With using HML, you need to factor in the points that comes with the loan and the added fees with draws during the rehab.

The other thing you will need to have is the architectural drawings and scope of work to be able to finish the project that was actually permitted.Worst case scenario, the city could make you resubmit for a new permit, possibly meaning new drawings stamped by an architect, and all new licensed trades.

Hi @Raymond G.If building you normally need to secure the land and then take out a new construction loan with draws until it is complete.

Of course, my mind goes straight to finding ways to use funds and invest in RE somehow... but I don't think I can take the draw all at once.

Because you can't get the full draw until the item is completed.