Funding houses or rehabs

5 Replies

Has anyone used prosper.com for funding houses?

Yes, I have used both Lending Club and Prosper to fund the purchase of houses.  I've talked about how these peer to peer (P2P) lending sites work in my podcast

Example 1 - Borrowed $21,000 from Lending Club.  Bought a house for $24,900.  Only had to come out of pocket the remainder of the funds + rehab costs.

Example 2 - Borrowed $18,000 from Prosper.  Bought a house for $23,000.  Only had to come out of pocket the remainder of the funds + rehab costs.

Example 3 - Borrowed $30,000 from Lending Club.  Bought a house for $24,000.  Had $0 of my own dollars into buying the house and had some of the rehab funded from this loan as well.

Summary: other users fund your total loan amount using smaller amounts from each person.  The loans are generally 3 or 5 years with no pre-payment penalty. The rates are higher than mortgage rates, but generally lower than hard money (depending on your credit).

These are credit based unsecured loans.

Dawn Anastasi, Core Properties, LLC | http://www.coreprop.biz | Podcast Guest on Show #29

Hi Dawn thank you for the information it is very helpful I will check into the lending club as well. 

Hello James thanks for your help.

@Dawn Anastasi do these report to credit bureaus? Are you taking the loans personally or a business is getting loan proceeds?

Originally posted by @Phil Workman :

Dawn Anastasi do these report to credit bureaus? Are you taking the loans personally or a business is getting loan proceeds?

 Yes, you will see these loans on your credit report.  Yes, I got these loans in my personal name.

Dawn Anastasi, Core Properties, LLC | http://www.coreprop.biz | Podcast Guest on Show #29