Hard Money lenders?

Question

I’m in Charleston SC, what’s the best way to find hard money lenders, what is needed and expected, and what’s the best way to structure the deal?

Troy Gandee · Answer

@Scott E. Coastal Equity Group is a great lender. I use them frequently for my deals. I also use RehabWallet for quite a few deals. Either on will be good choice, but RehabWallet does not lend on buy and hold deals. They're focused on flips/bridges. It just depends on what you need.

Scott E. · Answer

Just googled 'hard money lender Charleston, SC' and quite a few options showed up. This company called 'Coastal Equity Group' looks good. Great reviews.

Richard Loniewski · Answer

Best way is to reach out to hard money lenders and start relationships and ask questions, I'd be more than happy to go over any lending questions you have. Being an investor and lender can help you with some useful insights.

Chris Seveney · Answer

@Justin Woods

Tons of great information already provided. If none of those solutions work another great source is association of private lenders (aapl) where you can reach out to lenders as well.

You are better to start local though because they know the market.

Lastly if private lending does not work, look to bring on an equity partner - while you give up some equity, making some money and getting valuable experience is better than none

Mike Klarman · Answer

Justin, finding the hard money lender will not be the issue.  Really there's only a dozen or so real HML that the money comes from, other smaller outfits are Brokers with lending sounding names.

Nothing wrong dealing with a broker btw.  A good broker is worth their weight in gold.  They will have multiple lending options, they'll have contacts to people on the inside, the know what the processing is like, and they get loans closed and finances delivered.  All that for a point isn't so bad really. Because one of the big concerns I see on BP is how not to get scammed.  Well, one way to not get scammed is find a great broker who knows the lending industry in and out and can tell you what's a good term sheet and what is not.

As far as what is expected, if you have no experience then have money and credit.  Have no lates on your credit report and no felonies in your b.g.  They also will expect you to bring in a deal that makes sense.  That means keep total project cost under 70% ARV if a bridge loan.  They expect you to know the comps to your house, I mean they will order an appraisal so they will get an official number but if you're way off then your loan is dead.  A loan came into the office the other day, on the app the borrower noted the ARV to be 300k and when the appraisal came back it was 180k.  They have a signed purchase contract with no contingencies on mortgage approval because that's what the seller wanted.  That's what you call a bad spot.  Because the loan doesn't work at a 180k ARV.

If your credit is 740 or higher, I know a place that will give you 90% leverage, even as a 0 experience.  Incredibly risky, IMO, for the lender.

If you are buying a turnkey property and need to jump into a 30 year DSCR, then credit will matter most.  You'll need a credit score north of 720 to get the top leverage and rates.  DSCR loans rely heavily upon the ratio between the rent payment and the mortgage payment.  The min DSCR is 1.1 : 1.  You need to collect 1,100 in rent for every 1,000 in mortgage payment.  The great cash flowing properties have a DSCR of 1.35+, I've seen 1.8s come through the office.  Saw a 2.0 a few times, it's rare.

Robin Simon · Answer

BiggerPockets has featured Hard Money Lenders and contact information right here!

https://www.biggerpockets.com/...

Jacob D Adamczak · Answer

@Justin Woods  Hey Im local and I can tell you about several in the area.

1. Rehab Wallet - by far one of the easiest to use, however not usually the cheapest.  They will fund 90% of purchase and 100% of rehab up to 70% LTV when you use them the first time.  They do want you to have some experience. These two below are going to be cheaper but more paperwork up front, rate may vary upon experience, they pull credit where Rehab wallet doesnt, and they send out actual inspectors to verify the work where RW takes videos and pics and will wire within 12-48 hrs, expect 5-7 days with these others.2. Coastal equity group3. Brass financialJust make sure you ask about any reserve requirement with brass4. Several others, DM me if you wanted to reach out to more

Dennis Muno · Answer

Hello Justin,

Not all hard money lenders are the same. The best way to know a good hard money would be what is their record on closing fast? What is their reputation? Have they helped a lot of real estate investors? Are the rates they offer reasonable for investors to do their projects?

These are things to consider when looking for a good hard money lender

Bryce Jamison · Answer

I'd also recommend going to all of your local REI meetups. You'll usually find a nice mix of investors and ancillary industry folks there like wholesalers, agents, contractors, lenders, and lawyers.

This may take longer and require more effort than looking them up online, but you'll have the advantage of organically building a stronger relationship which may lead to more favorable terms for you compared to some Joe Schmo. It could also lead to finding partners and people that can help guide you and give advice.

As far as what's expected, imagine would you would want to see if you were going to lend some one tens of thousands of dollars. I'd want to see a good credit score, stable income, & history of success in REI. If you have these you may want to go the traditional mortgage route and that's why many people look to hard money lenders. If you don't have these things present them with a well organized plan for what you're going to do with the money. I'd want to see your numbers, your timeline, comparable market data, and what your exit strategies are. I'd also want to see a breakdown of any renovations you're going to do, with cost estimates, and who will be doing them. The more organized and professional you present this info the better chance you'll have of securing funds.

Katie Smith · Answer

Hi Justin! I would be happy to work together. I do a lot of work out of the Carolinas. Great market. Going to DM you!

Hard Money lenders?

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