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Forums » Make Deals, Find Partners, Mentors & BirdDogs, etc. » Does this interest any Hard Money Investors???

Does this interest any Hard Money Investors??? Subscribe to Does this interest any Hard Money Investors???

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Woodrow Carpenter

General Contractor · Toms River, NJ


Forum_avatar_avatar-uniquedesinez

Icon_minipost Nov 23 '08, 03:33 PM

I am not sure what a hard money investor would need to fund a deal, but I have a 3 br 1 ba ranch in a quiet area of Lacey, NJ. The price is $160,000 I am a contractor and can make this house a 4br 2 ba ranch and update the kitchen and other bath including necessary repairs and paint & carpet for 60,000.( That's labor and material) Total investment would be 220,000. I have done a CMA and the home ( upon completion of addition and repairs) will sell fast ( still under market value) for 270,000.After real estate fees ( aprox 13,000 , and I would like 10,000 the profit is 27,000. I am not sure about capitol gains. My question is with these figures being accurate, would an investor be interested in funding a deal like this ? What is the formula so I can look for deals that an investor would fund?

Edited: 06/26/2010 at 06:27AM


Adair Smith

Real Estate Investor · Jacksonville, Florida


Forum_avatar_avatar-reholdingsjax

Icon_minipost Nov 23 '08, 06:32 PM

Woodrow,

Most hard money lenders will only do <70% of ARV. I lend out of my self directed IRA to very specific people are I still require< 65% ARV. Lenders are becoming more and more conservative as real estate prices fail.

Edited: 06/26/2010 at 06:27AM


Jon Holdman

Real Estate Investor · Denver, Colorado


Forum_avatar_avatar-wheatie
ModeratorPro

Icon_minipost Nov 23 '08, 06:40 PM

No, you're too high for a hard money deal. If you could get hard money for the $220K investment, you would pay about $22K for the money. I'd estimate the back end sale costs closer to $22,000, maybe a little more if you have to make concessions. A 6% RE commission alone would be $16,200. With the other costs (buy closing cost, utilities, insurance), there's no potential profit here for you with hard money.

Edited: 06/26/2010 at 06:27AM

Small_flying-phoenixJon Holdman, Flying Phoenix LLC


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