Hard Money Lender for first time investor

Member since 2023 · 7 posts · 1 vote

Does anyone know any hard money lenders that are willing to work with your deal based off the ARV? No seasoned assets, credit checks or bank statements?

how much money would I have to come out of pocket to work with a hard money lender in a fix and flip deal?

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AJ ExnerPro Member

Lender · Springfield, MO · Member since 2023 · 660 posts · 319 votes

Quote from @Jorge Betancourt:

Hey Jorge,

Great to hear that you are jumping into the game and sounds like you have a good property to start.
So the money out of pocket is going to fluctuate quite a bit based on the lender, but no matter what in the HML space, most groups are at the very least credit 'informed', meaning that they would at least do a 'soft' inquiry and a back ground check to decide the terms and the risk of the investment from their perspective.

Of the lenders that I work with, there are a few that do no asset seasoning, and that is something that it feels would be VERY important to clarify on the front end of any deal you do. Most lenders will at least do a bank statement of some kind to confirm that you have the cash to close at least.

Otherwise, I would anticipate around 15%-20% down for your first time. With exceptional credit, there is a potential for more leverage, but that would be best to iron out with a broker or the lender on the front end.

I hope that helps! Let me know if I could help additionally in any way.

[email protected]417-427-2612

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Logan Singleton
Lender · Boston, MA · Member since 2023 · 415 posts · 95 votes
2y
Hi @Jorge Betancourt, Can you please tell me more about the property?
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Jorge Betancourt
OP
Member since 2023 · 7 posts · 1 vote
2y
Quote from @Logan Singleton:

Hi @Jorge Betancourt, Can you please tell me more about the property?
5 beds , 2 bath , 1,900 sqft

purchase price: $165k
rehab is $40k
ARV is around $300k

i got the ARV from a realtor with comps available as well.

let me know what more information you need please :)
0 Reply
Chris SeveneyBusiness Member
Moderator
Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
2y
@Jorge Betancourt
You typically would not find a lender based solely off arv unless it’s one you have a considerable track record with.
7e investments53 Reviews
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1 Reply
Justin BrickmanBusiness Member
Realtor · San Antonio, TX · Member since 2021 · 502 posts · 274 votes
2y
Quote from @Jorge Betancourt:

Does anyone know any hard money lenders that are willing to work with your deal based off the ARV? No seasoned assets, credit checks or bank statements?

how much money would I have to come out of pocket to work with a hard money lender in a fix and flip deal?

One of my client's is a hard money lender - Longhorn Investments, and it's based off the ARV. I can connect you with them if you private message me
[email protected]210-827-6020
Justin Brickman Realty4.9145 Reviews
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Jorge Betancourt
OP
Member since 2023 · 7 posts · 1 vote
2y
Quote from @Chris Seveney:

@Jorge Betancourt
You typically would not find a lender based solely off arv unless it’s one you have a considerable track record with.
Would you recommend I find a partner instead of a hard money lender? Cause it seems the only way they will work with me is if i’m not a first time flipper lol if so do you know where or how I would go about finding a partner?
0 Reply
Jorge Betancourt
OP
Member since 2023 · 7 posts · 1 vote
2y
Quote from @Justin Brickman:

Quote from @Jorge Betancourt:

Does anyone know any hard money lenders that are willing to work with your deal based off the ARV? No seasoned assets, credit checks or bank statements?

how much money would I have to come out of pocket to work with a hard money lender in a fix and flip deal?

One of my client's is a hard money lender - Longhorn Investments, and it's based off the ARV. I can connect you with them if you private message me

Will do thanks!
0 Reply
River SavaPro Member
Lender · USA · Member since 2022 · 1k+ posts · 1k+ votes
2y
Hi Jorge - Would love to connect and see if I can point you in the right direction. I sent you a message
[email protected]
1 Reply
AJ ExnerPro Member
Lender · Springfield, MO · Member since 2023 · 660 posts · 319 votes
2y
Quote from @Jorge Betancourt:

Does anyone know any hard money lenders that are willing to work with your deal based off the ARV? No seasoned assets, credit checks or bank statements?

how much money would I have to come out of pocket to work with a hard money lender in a fix and flip deal?
Hey Jorge,

Great to hear that you are jumping into the game and sounds like you have a good property to start.
So the money out of pocket is going to fluctuate quite a bit based on the lender, but no matter what in the HML space, most groups are at the very least credit 'informed', meaning that they would at least do a 'soft' inquiry and a back ground check to decide the terms and the risk of the investment from their perspective.

Of the lenders that I work with, there are a few that do no asset seasoning, and that is something that it feels would be VERY important to clarify on the front end of any deal you do. Most lenders will at least do a bank statement of some kind to confirm that you have the cash to close at least.

Otherwise, I would anticipate around 15%-20% down for your first time. With exceptional credit, there is a potential for more leverage, but that would be best to iron out with a broker or the lender on the front end.

I hope that helps! Let me know if I could help additionally in any way.
[email protected]417-427-2612
3 Reply
Matt VillantiPro Member
Lender · Houston, TX · Member since 2023 · 21 posts · 8 votes
2y
The Lender "working with you " will based be off your experience, your credit score (if applicable), and your cash reserves. Most hard money lenders will provide you an initial range of terms range based off those three things.

I'd look for a lender that gives you the same terms from the start, not a range. Unfortunately, that range can vary based off those three factors I mentioned earlier.

FlipCo Financial will not pull your credit and will keep your points and interest rate consistent no matter what. Any manipulation to the deal will potentially be the money you put down up front.

I would love to chat more, is this property in GA?
1 Reply
Eliott Elias
Investor · Austin, TX · Member since 2021 · 9k+ posts · 5k+ votes
2y
Most hard money lenders qualify the property rather than the borrower. Your interest-rate and points may differ depending on your level of experience.
2 Reply
Ryan Davies
Investor · Salt Lake City, UT · Member since 2019 · 339 posts · 126 votes
2y
Most do:
- Rates: 10% to 14% (Most Deals are 12%)
- Terms: 1 Day - 24 Months (Most Deals are 6 months)
- Fees: 2-5 points(%) of loan amount paid at closing (Most Deals are 3 points(%))
- Minimum Loan Amount: $50,000
- Max Loan: 65-70% of After Repair Value(ARV)
- 100% Rehab Financing Available (Most Deals require 20% of purchase price down payment or cross-collateral)
- Closing Timeframe: 48 Hours - 3 Weeks (Most Deals are 10 business days)
- NO PRIMARY RESIDENCES, NON-OWNER OCCUPIED ONLY, BUSINESS AND COMMERCIAL USE ONLY.
2 Reply
Chris SeveneyBusiness Member
Moderator
Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
2y
Quote from @Jorge Betancourt:

Quote from @Chris Seveney:

@Jorge Betancourt
You typically would not find a lender based solely off arv unless it’s one you have a considerable track record with.
Would you recommend I find a partner instead of a hard money lender? Cause it seems the only way they will work with me is if i’m not a first time flipper lol if so do you know where or how I would go about finding a partner?

Yes you are better off finding a partner in that situation
7e investments53 Reviews
Website View Page
0 Reply
Ryan Stuckey
Lender · Member since 2022 · 217 posts · 149 votes
2y
At Longhorn, we can lend to first-time investors if the numbers are right (including 100% of costs, up to 75% of ARV) but a credit check is needed (650 needed for standard terms). If any questions, please let me know.
1 Reply
Jorge Betancourt
OP
Member since 2023 · 7 posts · 1 vote
2y
Quote from @Ryan Stuckey:

At Longhorn, we can lend to first-time investors if the numbers are right (including 100% of costs, up to 75% of ARV) but a credit check is needed (650 needed for standard terms). If any questions, please let me know.

Hi, that's awesome! Just so I understand though, what does 100% of the costs up to 75% of ARV actually mean?

Example;

house price $165k
rehab is $45k

Total needed is $210,000

ARV is $300k (If you lend 75% of that)

that’s $225k , meaning there’s $15k left.. what would this go to? What are my costs out of pocket? Am I understanding it correctly? Thank you for your patience 🙃

0 Reply
Ryan Stuckey
Lender · Member since 2022 · 217 posts · 149 votes
2y
On $300k ARV, max loan size is 75%/$225k. Your costs are below that so they could be fully financed on both purchase price and rehab components. The loan size would be at the level of those $210k in costs. You would have no down payment but you would have some closing costs.
Feel free to get in touch if you would like more specific info on any project.
0 Reply
Jorge Betancourt
OP
Member since 2023 · 7 posts · 1 vote
2y
Quote from @Ryan Stuckey:

On $300k ARV, max loan size is 75%/$225k. Your costs are below that so they could be fully financed on both purchase price and rehab components. The loan size would be at the level of those $210k in costs. You would have no down payment but you would have some closing costs.
Feel free to get in touch if you would like more specific info on any project.

These are the requirements on the website;
- Minimum Credit Score of 600
- Minimum of $15,000 or more in a Checking, Savings, IRA and/or 401(k) account
- No Recent Bankruptcy or Foreclosures (subject to review by Longhorn)
- $15,000 has to be seasoned? I have my own funds plus 2 of my family members are willing to lend me a couple extra dollars to have that $15k in Checkings
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