Hard money loan to have skin in a deal ?

3 Replies

If I have a small amount of money to invest in a deal that I am syndicating with other parties, can I take a hard money loan to up my skin in the deal and pay the loan right back with my acquisition fee that I take for operating the deal? Is this possible / worth it at all?

My experience with hard money lenders is that they want to have actual collateral.  What would be the hard money lender's collateral in your scenario?

I like your thinking though.  Depending on the amount your looking for could you obtain a personal loan from a bank for a short time?  Or from a website like prosper or lending cloud?

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@Greg K. I think the key point is that you're saying ARV of $1.2M IF a condo conversion is allowed. I don't think any HML would use that value, they would use existing 2 family comps.

But call around to local lenders and see what they think.  12 days is a tight turn around period.  Hopefully they're aren't restrictions on buying from a family member and involving a short sale.

Good luck and hope it works out.

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