Gap Funding/Lines of Credit

[Zach Kirchoff]

New to the community here. Medium sized flipper here out of Minneapolis doing between 40-50 deals per year. Looking for insight into borrowing money to cover down payments and floating capital between renovation draws. Currently have a small executive line of credit at $350k that we outgrew in about 12 months.

Does anyone have any good contacts for secondary lenders? Talking about a person or company who will bring in cash for down payments and floating capital between renovation draws. I am open to private individuals, just have not found the one who can cover this level of scale. 

Have plenty of SFRs to collateralize with second mortgages but do not own any of them free and clear. Most lenders will do lines of credit only on "lendable" equity in SFR's and/or properties owned outright.

Would be looking for between $600-700k on a new loan to pay off our current line and have free cash to continue to scale. 

Any insight would be appreciated!

[Zach Kirchoff]

James and Jay, not trying to touch off any spidey senses. Our cash position always sits between 20-25% of total outlaying debt ($3M worth of debt on properties and $600k of floating cash to avoid problems and/or market turns). 

Re: using the new line to pay off the old. I have found it hard enough to get 1 line of credit, let alone 2 on the same business. 2nd line would need to satisfy the 1st for the lender to give it to me.

Thanks for the ideas on equity partner - will be the path that looks most promising!