Hard money lender criteria

[Lee Schram]

Hi bp community, 

Im running into some difficulty finding financing for some potential deals because the purchase price is lower than the rehab amount. Several hard money lenders have told me that they won't lend because of this. 

Any suggestions? Or know a lender where this is not an issue? 

Thanks 

[Paul Khazansky]

Typically this should not be an issue as long as you are bringing enough equity (i.e. cash) to the deal at closing. Buying a property for say, $70,000, and putting another $100,000 of rehab capital into should not be a problem as long as (a) your comps support a high-enough ARV, and (b) you are bringing enough equity to the deal.