Hey everyone, I'm looking for private funding on a new investment property. I'll have around 20k for a down payment. Where could I find help with funding and how much do you think I could get approved for? Thanks for the help!!
Private lenders are people you know who are willing to lend to you. You find them by talking to everyone you know and everyone you meet about what you're doing. A few will be interested. A few of those will have money they're willing to lend. It takes time, but if you work to meet enough people you will eventually find some.
Otherwise, banks and mortgage brokers are good sources for cheap money. How much you could be approved for depends on additional factors. If you have $20K down, additional money for closing costs and additional money for cash reserves, and the other factors (credit score and DTI) are OK, then you should be able to get a $80K loan.
The other alternative is hard money. The requirements for that are a lot more varied and the deal itself comes into play. Note that many hard money brokers refer to themselves as "private money".
If you're looking for specific names you will need to post in the Marketplace.
Jon Holdman, Flying Phoenix LLC
I would definitely start with your local banks and brokers first. Some credit unions do a great job as well and can do some out of the box deals if they run it as a portfolio loan. Otherwise I would stay local and network as much as possible to find a private lender. That is the best way to keep your financing costs down, which is crucial on smaller deals.
There are plenty of hard money lenders out there, as far as the bigger shops. But most, in my experience, stick to commercial deals. The financing costs get high, so they are better for larger deals.
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