I know this isn't a typical thing private money lenders do but, I'm looking for any private money lenders that would be able to give pre-approval of loan amounts prior to having a contract. The issue I'm running into is in order to get a house under contract I have to show proof of funds for cash offers. I have some cash to put towards deal and would feel a lot more confident knowing I have the rest pre-approved when offering cash offers. I know a lot of people say get it under contract then apply, but I'm retired military and I like to have all my ducks in a row to make the best impact. We are looking at rehabs that will have an ARV of $200k or less. Any suggestions would be greatly appreciated.
I know it's not considered a cash offer when getting funding from outside source and I should have written that a little different, Offers with private lender financing and proof of funds at the time of writing contract.
I don't know about private lenders, but I believe that at least some (maybe most) hard money lenders will offer proof of funds/pre-approval letters.
A pre-approval is specific to residential mortgages. You can ask a HML or PL for a proof of funds or a non-binding term sheet.
Depends on the HML whether they will actually give you one given most deals are under contract when financing is talked about.
I’m a HML FYI
Hard money lenders can give you a letter on intent.
Any reputable HML should be able to give you a proof of funds. Not all HML are created the same. Some may just hand them out like candy and not care too much about your personal finances or credit situation. Other lenders may want to run credit and background before sending out a proof of funds letter.
All in all, the less they check in to your history the higher the rates may be. Not a hard rule, but the more perceived risk the more you pay for borrowing the cash.