Would a hard money lender lend to a newbie
Hello,
I'm looking into purchasing my first investment property and would like to use hard money or private money to finance the purchase if is possible for a newbie? would they even consider? My back ground is construction so I am comfortable with the rehab process.
( I do have cash available, but would love to gain experience with leverage )
I am aware of the current market situation, so everything would be in the assumption of having a great deal in hand.
Thank you very much for your time, and all feed back is much appreciated.
While each lender is different, and of course experience is preferred, everyone has to start somewhere right! In my experience most lenders will consider lending to a 'newbie' as you refer to it. There may be compensating factors, i.e. they could ask you for more down, they could charge you a higher fee or a higher rate, etc. That said, if you have construction experience, and better yet, you have cash, then you should have no problem getting a hard or private money loan.
Agreed, as direct lender, we lend to first time investors. Cash is king, and rates are less favorable than those with experience.
Ultimately, loyalty and repeat borrowers have more negotiating room as time goes on.
With you being able to put some of your own skin in the game, you will be able to get a hard money lender even though you don't have experience with investing. The underwriters will like your construction background too.
@Jonathan Chu: absolutely yes... for all the reasons my colleagues have stated. But as you mentioned, the best thing you could do to help yourself is find a deal well below market with equity built in when you purchase. This will give your lender more comfort... and perhaps spare you from having to put more money down.
@Patrick Prunty thank you for your reply
@Issac San Miguel thank you for your reply
@Scott E.thank you
@Dave Spector thank you