Hard Money, Private Money, Show Me the Money!

[Holly Barrett]

Okay ya'll, I'm confused. Here's the situation. 

6 unit Multifamily in Arkansas

I MIGHT be able to show the reserves needed (but really it's a stretch)

$250K Purchase Price

$100K renovation

$500K ARV

$6K After Repair Monthly Rent

(I WANT THIS PROPERTY!) We have another property in the same town so I already have a solid team in place. 

I thought I could borrow down payment from private individuals inexchange for let's say a 10% return after renovation. However, the hard money lender I just spoke w/says they would need to have an equity position. I don't really want to take that route, too many cooks in the kitchen, drama, you know! 

However, if I am doing a refi after reno would we structure it like: they have equity position during the fix and flip post purchase stage and then I essentially 'buy them out' with the cash out refi $ into a long term loan post rehab?

Are there hard money lenders out there with lax reserve requirements?

My brain hurt, someone dumb this down for me! :)

[Cole Booth]

Hi Holly, 

There are quite a few programs we have that do not require liquidity sourcing to ensure you are able to borrow money to close on the property in question. It will help that you have past experience and are not a first time borrower. 

Reach out anytime if you have any questions!