Financing in Indiana - Buy and Hold Properties
Good Evening Ladies and Gents!
While I need to provide some context, I will attempt to keep brevity in mind, as I know time is our number one commodity here :)
I just began my investing endeavor earlier this year - I was able to find a private investor who was willing to take a shot on me. I found a foreclosure, put in an offer under my newly created LLC and before I knew it, I was underway. Throughout the course of the rehab I payed my private investor an 18% annualized return every month on his invested capital. Once the project was completed, we found a buyer and I paid him off in full and I pocketed the profits. Despite a few unexpected hiccups throughout the rehab, it went exactly as planned.
I just put in an offer for my next project, with the intentions of using the same private investor to finance the deal. However, this time around, I would love to convert it to a rental as the cap rate would be close to 20% and the LTV to cover the entire project costs would be roughly 70-73%! My question is this, what advice do you have for me regarding pulling the money out and paying off my investor?
I've read forums suggesting HELOCs, Conventional Loans. etc. etc. - I would love to hear some input regarding my exact situation. I would also love to hear if anyone out there in the BP world has any experience with any local banks or credit unions in the Indianapolis market that would be willing to work with me! I've been calling around the last few days with not much luck. Any information is greatly appreciated, I look forward to hearing from you!
Chris