Hard Money, Bad Credit, Conventional Financing.

2 Replies

Hello all, I am a Acquisitions manager for a wholesaler here in OKC, Oklahoma  I absolutely love Wholesaleing and I get first look at all of our deals. 

 My question is my credit is horrible, but I am in the process of rehabbing it. The bottom line is I can not get a bank to give me funding. 

 I am in the process of speaking with a hard money lender and he is going to charge me 12%  with no points, but my question is how soon can I refinance that into a more conventional loan? 

Is it just as soon as my credit has repaired enough to switch it over? My goal is to only have the hard money loan for a year and then get my Intrest down to 4-6%... If I can be all in for 25k-35k I can cash flow about $150-$250 a Month with the hard money, but if I get that refinanced the cash flow goes up tremendously... Also the deals I am getting need less than 1-5kk in repair to be rentable and are 60-70% of ARV. So basically buying a house that would sell for 60-70k with 5-10k in repair

Thank you for all your answers and insight. 

@Mark W Carpenter most hard lenders will want your exit strategy down before they approve you for their loan.  If you are flipping, that is apparent and they will want to only lend you enough money so that you can flip.  If you are buying and holding they would likely need a prequalification letter from your lender.  Remember, their loan comes due...in full...after 6 or 12 months.  I don't know your full profile but if credit is the ONLY item holding you back, than you can start to refinance right after your score qualifies....assuming nothing else changes.  A conventional lender will be able to tell you if everything else about your profile qualifies.  Hope this helps.

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