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Sawyer Lubke
  • Real Estate Agent
  • Minneapolis, MN
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Financing Spec/New Construction Homes for New Investors

Sawyer Lubke
  • Real Estate Agent
  • Minneapolis, MN
Posted Sep 22 2014, 12:57

I'm looking to have a discussion on how new investors can acquire financing to build a spec home. Here is what I have come up with:

1. Bank Financed. The bank informed me they need me to live in the home for 1 year before selling, which is not going to work. Has anyone out there worked with banks using personal qualifications (credit/income/down payment etc.) opposed to having the "relationship" to do a spec build? This seems to be the most affordable method. 

2. Hard Money Lender. This is a readily available option, however the going rate here is 4 points and 15%. 

3. Private Money. I would prefer to have a track record of success before pursuing this route. Without one I think raising funds would be very challenging

How are you financing your spec builds or how might you recommend a new investor jump into this type of investing? 

Thanks for your input!

Sawyer

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