we are looking to buy our first flip house and we are unable to get conventional loans as the property is foreclosed and they will not turn the water on. We are considering private investor and also hard money investors. Any advice on how to find a good hard money investor? Or advice on how to make sure they are reputable?
I would find them and check them out the same way I would do the same with any other service provider or contractor:
- Talk to other investors
- Go to investment clubs and ask around
- Google search to find and then ask others about them
- Get references, and call them
Happy hunting, this is a big decision
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As a novice, it is important to have a lender that will give you the personal attention you deserve and help walk you through the steps. It should be a team effort from start to finish. Online real estate forums, local brokers, and experienced investors should be able to point you in the right direction. Once you have a few lenders in mind, it may be wise to get a break down of the programs they offer and potentially ask for references.
Hope that helps!
Thanks for the advice everyone!
Hi @Becky Wolfe
I would suggest asking all the lenders to confirm the following points:
- Interest Rate & Points: pretty obvious, straight forward, compare with others
- No Prepayment Penalty: this will be important as you will likely be refinancing out soon with a conventional loan
- Are they Direct: make sure they are the actual check writer, that the money is in house, and they can close quickly once they commit
Other than that it should be pretty straight forward. Hard money rates should be pretty easy to research in your area just by Googling it. Private investors should have cheaper rates but they're more difficult to find. I would also suggest checking out the local Real Estate Investor networking groups, as that is where these private individual investors typically hide.
Thanks for the advice! Very helpful!!
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