Flipper · Gahanna, OH · Member since 2017 · 19 posts · 3 votes
I am a self employed real estate investor in my first year of real estate investing. I currently buy and flip foreclosed properties. I currently have a private lender that loans me money for my flips but I would like to buy a property, fix it up, get tenants in the property, refinance (get a loan) and pay back my private lender and use my rental income to pay for my mortgage. The issue I am having is I can not get a conventional mortgage because they require 2 years of tax statements that I do not have yet. Any advice on how to overcome this problem and get a loan would be greatly appreciated!
@Jordan Lester, you can also get a 'no doc' hard money loan where they don't look at your tax returns. Or since you have the experience you may not need impressive tax returns to seal the deal. Private and hard money lenders either are or have typically been investors themselves so they know how it is.
@Jordan Lester, you can also get a 'no doc' hard money loan where they don't look at your tax returns. Or since you have the experience you may not need impressive tax returns to seal the deal. Private and hard money lenders either are or have typically been investors themselves so they know how it is.
I am a self employed real estate investor in my first year of real estate investing. I currently buy and flip foreclosed properties. I currently have a private lender that loans me money for my flips but I would like to buy a property, fix it up, get tenants in the property, refinance (get a loan) and pay back my private lender and use my rental income to pay for my mortgage. The issue I am having is I can not get a conventional mortgage because they require 2 years of tax statements that I do not have yet. Any advice on how to overcome this problem and get a loan would be greatly appreciated!
This is a common problem Jordan. Few options:
Non-bank lenders like Lima One and Visio usually do loans based on the performance on the property. The do look at previous income but it's not a totally "global" approach that most banks take. These guys will cash you out after 6 months seasoning as well, meaning if you get a solid discount you could get all your money back, and possibly more.
Private Lender- If you have a private lender that you could offer a long term loan, maybe 2 years or so, you will probably have to pay them a higher interest rate, but it's better then not picking up rentals for another 2 years.
Lastly, bring on an partner who has solid income history. Ok ready for the cliche... "50% of something is better then 100% nothing".
@Jordan Lester You've received some good ideas and advice above. The one thought I believe is missing is that while most hard money lenders and private lenders prefer short term loans, there is a minority that actually prefers longer term loans of about 2 years or more. They're harder to find (fewer of them) but worth the search effort in your situation.
Also, there is a meeting on Wed. evening, Sept 27th in Dublin. There's usually a private lender or 2 and/or a hard money lender or 2 in attendance. Check here on BP under "Network" and then "Events".
Thank you for the advice, Im glad to hear there is a meeting in the columbus area! I will try to make it to the meeting but if I don't make it to this weeks meeting, please let me know if there are any more upcoming meetings!