Refinance Out of a Hard Money Loan

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Refinance Out of a Hard Money Loan

Jeff Stephens
Property Manager · Portland, OR · Member since 2013 · 28 posts · 18 votes

I am looking for ways to refinance out of a hard money loan, without using Fannie/Freddie conventional financing. I am going to be purchasing a property and using hard money for the acquisition, but I think I'd like to keep the property for the long term as a rental.  I don't want to/can't use conventional Fannie/Freddie loans--do you have any recommendations on options to refinance with?

Thank you!!
Jeff

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  • Curt DavisBusiness Member
    Flipper/Rehabber · Memphis, TN · Member since 2008 · 5k+ posts · 2k+ votes
    12y

    Figure out how you will pay back the HML before you purchase.

    Why cant you refi the traditional way?  Your only chance then will be to find a local bank that makes their own rules.

    Curt Davis - KAIZEN Realty538 Reviews
    WebsiteView Page
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  • Ned CareyPro Member
    Moderator
    Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
    12y

    If I understand your situation basically your only choice is a private lender. Of course if you have a private lender, I wouldn't use the hard money in the first place. 

    Ditto the comment about if you don't know how you are going to refinance out the hard money lender don't borrow in the first place.

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  • Jeff Stephens
    OP
    Property Manager · Portland, OR · Member since 2013 · 28 posts · 18 votes
    12y

    Hi @Curt, thanks for your reply. I can't realistically refi out traditionally for a combination of a few reasons:

    • we're buying it in our LLC which is relatively new (doesn't have previous years tax returns, etc.)
    • I don't have w-2 documented income at this point
    • i already have 4 other Fannie/Freddie loan
    • the traditional loan LTV restrictions wouldn't provide enough proceeds to take out the hard money loan
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  • Jeff Stephens
    OP
    Property Manager · Portland, OR · Member since 2013 · 28 posts · 18 votes
    12y

    Thanks @Ned, I appreciate the thoughts. I do think it's possible to potentially find a private lender, I just don't have that relationship in place at this point, in time to close. I guess my best option, if I choose to proceed and close, is to simply sell it and forego the opportunity to hold it for the long term.

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