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Updated 4 days ago on . Most recent reply

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Chris McDaniel
  • Investor
  • Houston, Tx
0
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4
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Looking for Lender Guidance on $20K Seller Credit Deal Structure

Chris McDaniel
  • Investor
  • Houston, Tx
Posted

Hi BP Community,

I’m working on a deal in Houston/Pasadena, TX and could use some insight from those with experience.

  • Purchase Price: $185K
  • Seller Credit: $20K applied toward rehab at closing
  • Effective Net Purchase: $165K
  • ARV (conservative): $220K – $230K
  • Rehab Budget: ~$20K–$25K (HVAC, bathrooms, floors, cosmetics)
  • Exit: Refi into DSCR or conventional in 12–18 months

I’m trying to confirm with lenders how the $20K seller credit will be treated:

  1. Will hard money lenders allow this structure and apply the credit directly to rehab?
  2. If not, how do I best position this so it’s workable?
  3. Any recommendations for investor-friendly lenders (HML or DSCR) in Houston that have handled seller credit situations?

Goal is to make this a clean BRRRR deal with minimal cash in. Appreciate any advice or lender recommendations!

Thanks in advance!

— Christopher McDaniel

  • Chris McDaniel
  • Most Popular Reply

    User Stats

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    Chris Seveney
    • Investor
    • Virginia
    17,263
    Votes |
    19,635
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    Chris Seveney
    • Investor
    • Virginia
    ModeratorReplied

    Typically credited it as cash required to close as long as appraisal comes in clean. 
    you would still need rehab funds or get financing on those:

    I would be concerned about refinance as the ltv when renovation is complete is very high and DSCR typically on refinance may not go as high as you need

    • Chris Seveney
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    7e investments
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