Private Money Loan For Rentals

[Mikael Winkler]

Hello all!

I've recently had a couple forum posts regarding hard and private money financing, then financing into a mortgage, for a rental. I've slowly been learning both avenues and hopefully I'll have a better grasp after this post!

My remaining uncertainty lies with private money. I've heard of instances where private money was used for the purchase and rehab and the borrower wasn't required to make any interest payments (as with hard money), with the lender collecting the principal and interest at the end, after the refi. I was simply wondering if this is possible and how it would work with the refi. How would the private lender's principal balance and interest be paid back?

Any guidance or clarification would be greatly appreciated! Thanks!

Mikael W.