Which Type of Loan Will Be Best for Your Next Deal?

Which Type of Loan Will Be Best for Your Next Deal?

1 min read
Matt Faircloth

Matt Faircloth, co-founder and president of the DeRosa Group, is a seasoned real estate investor. The DeRosa Group, based in historic Trenton, N.J., is a developer and owner of commercial and residential property with a mission to “transform lives through real estate.” DeRosa creates partnerships to finance select real estate investments and has a proven track record of providing safe, profitable investment opportunities to their clients.

Matt, along with his wife Liz, started investing in real estate in 2004 with the purchase of a duplex outside of Philadelphia with a $30,000 private loan. They founded DeRosa Group in 2005 and have since grown the company to hundreds of units in residential and commercial assets throughout the East Coast. Under Matt’s leadership, DeRosa has completed tens of millions in real estate transactions involving private capital, including fix and flips, single family home rentals, mixed-use buildings, apartment buildings, and office buildings.

Matt is an active contributor to the BiggerPockets Blog and has been featured on the BiggerPockets Podcast three times (show #88, #203, and #289). He also regularly contributes to BiggerPockets’ Facebook Live sessions and teaches free educational webinars for the BiggerPockets Community.

Matt authored the Amazon Best Seller Raising Private Capital: Building Your Real Estate Empire Using Other People’s Money. The book is a comprehensive roadmap for investors looking to inject more private capital into their real estate investing business and is a must-read for anyone looking to grow their business by using private lenders and equity investors. Kirkus, the No. 1 trade review publication for books, had this to say about Raising Private Capital: “In this impressively accessible introduction to a complex subject, Faircloth covers every aspect of private funding, presuming little knowledge on the part of the reader.”

Matt and his wife Liz live in New Hope, Penn., with their two children.

Matt earned a B.S. in Industrial and Systems Engineering with a minor in Business from Virginia Tech. (Go, Hokies!)

DeRosa Group’s YouTube channel

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As you know, there are many types of loans you can get. There are bank loans, hard money loans, private money loans, and even credit card loans that you can seek for your deals. It’s important to know all the different loan options that are out there. But it’s just as important, if not more so, to get to know how to apply those loans properly in your business.

The Art of the Deal

I can tell you firsthand that applying the wrong loan to your deal can make the difference between a profit and a loss. Things like taking a long-term project like a stabilized buy-and-hold an using what I would call “short term” loans on it — such as private money or a credit card— can kill your otherwise profitable deal. The same goes for jumping through the hoops to get long-term bank capital and use it on a deal that doesn’t benefit from that type of money.

Related: 7 Questions Real Estate Investors Should Ask When Selecting a Lender

Related: How to Structure Your Private Loans: An Interview with 4 Real Estate Investors

Watch This Video!

In today’s video, I talk about what types of loans you should consider for wholesale deals (yes, wholesalers need to borrow money sometimes, too), fix-and-flip deals, and buy-and-holds (including BRRRR, turnkeys, and apartment building deals). Be sure to check it out. It’s full of info on different types of loans and how to match them to any type of deal. Check it out!

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Do you have questions about pairing loans with specific deals?

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