Hard Money Lenders issues

[Jesse Simpson]

All the research I’ve done through Bigger Pockets, I cant seem to find a Hard Money lender to lend under $50,000.

In my area (Illinois) there are properties selling between $5,000-$10,000. With an estimated Reno costs between $20,000-30,000. ARV $50,000-$60,000. Is it worth it to not explore these deals and expand my vision to houses in the $30,000-40,000 range to be able to meet the loan value minimum of $50,000?

[Jay Hinrichs]

Originally posted by @Ronald Starusnak:

Originally posted by @Jay Hinrichs:

Originally posted by @Jesse Simpson:

I really appreciate everyone’s input as time is money. I have a better idea of where to go. Thank you! 

lenders will do them but keep in mind you need as a lender to bring in 4 to 5k per file other wise you cant keep the door open.

so as long as your willing to pay for it.. you can get it..  I do these every day..  its my niche but I am not going to do them for 1k or 2k waste of time and risk not worth it..  

and most of the ones I do that are small like that.. there is such huge upside for the buyer.. its either don't get it at all or just add 5k to it and its the cost of doing business..  

just like all these posts I see on BP with the folks that don't want to share with equity partners thinking they are the big deal when in fact the money is the big deal..  no money no deal.. better to get a piece of the pie until you can fund your own.. then get nothing. I built an entire business based on small asset lending.  

Speaking on the 4-5k per loan, that's exactly what I offer my private lenders. If they're lending me $20k, I'm giving them $5k. These cheap properties perform well and have good margins. Just about every single property on my buy list will cash flow over $500 a month after the refi. Right now it just makes way more since for me to buy these kinds of properties because the cash flow is way better here. I won't even touch anything over $100k because I'm not interested in a $200-$300 / month net. I have a 2 family on this list that we will be in under $40k if our offer is accepted and we will NET $900-$1,100 a month. The ARV on this thing is under $60k.

ya that's one concept that people really don't think through.. they start with what are bank rates and then the ABSOLUTE best HML rates and think that's what they should pay.. how can a lender make money lending at 2 points on a 20k loan.. the risk is far to great especially in NY where you could spend thousands and take years if your borrower stopped paying..