Brooklyn, NY · Member since 2015 · 10 posts · 4 votes
Hello as a new investor, I find that I don't ask as many questions as I should, in fear of looking stupid. But ignorance is a luxury that I can not afford, so here is my question. When dealing with a private lender, how much of your own money is needed? As a new investor, I want to know where I should be financially before seeking funding. Or am I going about it the wrong way. I know most banks want you to have at least 20% down, but does that apply with private lenders? And how concern should us new investors be with the interest rates? All feedback is welcome and appreciated. Thank you
Private lenders are people you personally know: friends and family and it's whatever you two come in agreement regarding the down payment.
If you're short on the down payment, look into an FHA loan which is 3.5% down, as long as you'll occupy the place. If it's non owner occupied, then yes, 20-25% down for banks or hard money lenders is common.