I'm looking for advice on potentially refincing a hard money loan.
We purchased an off-market property in Seattle that closed back in January with a 12 month hard money loan. Our plan was to renovate the existing house and build a ADU in the basement. We will also be building a DADU on the property and forming a condominium association to sell each one seperately. When we demo'ed the basement we found that there was essentially no foundation and the best option would be to demo the house and build a new, modern and larger SFR/ADU.
We decided to proceed with the DADU constrution which when sold would pay off the loan. The permit took longer than expected but we now have it and are ready to break ground. We have the funds for the DADU construction but our loan will expire in January.
We applied for an extension but were denied because we have someone living in the house, mainly to prevent possible sqatters but I listed them as family. So right now it looks like we need another lending option to finish the project. We'd appreciate any advice
Hmmm, I do hard money all the time for all my flippers. This leads me to a few questions?
Can you explain what you meant by the fact that there is a basement, however there is no foundation, which is causing you to want to demo the whole structure and build new? Also, wouldn't it be less expensive to lift the house enough that a foundation can be poured and then set the house back down? That has to be less expensive than a demo and full new build?
How much are you into this project already at this point, cost wise? have you pulled comps to support the ARV versus the cost to do this project? I think the current lender is really just concerned that there isn't enough value to support a demo and new build.
I'd be willing to consult, but I would want a lot of details to help determine your best course forward.
I hope this helps?
The basement is only a partial basement with a step foundation. The house was initialy built as a post and pier construction and the basement was excavated about 2 feet in from the exterior walls to leave bearing for the exterior walls/posts. When we removed the drwalland plywood we found the bottom of the walls and posts are rotted and there is no foundation below.
I'll contact you directly to go over the numbers.
@John McNeill , I will message you a lender than can help!