Purchasing that First Flip

[Matt Rozzell]

I'm wanting to jump in. Get a flip funded. Don't have a property under contract or anything but wondering what all of your thoughts are on getting funding. I've been talking to personal money lenders and one in particular is saying 100% purchase price with 10% interest only payments for a year term with 1 point first position. I'm thinking about going to a Hard money lender for the rehab costs? Any and all help would be greatly appreciated!

[Odie Ayaga]

So verbiage: when you say personal money lender do you mean private money lender (i.e. someone who doesn't lend money as a profession)? When you say "I'm thinking about going to a hard money lender for the rehab costs" do you mean you're thinking of going to a private money lender for purchase and a hard money lender for the rehab? That almost definitely won't work if that's a case. That's two liens on a property and a hard money lender isn't likely to do it, especially not from second position. Typically you go to a hard money lender and they provide some percentage of the purchase price and 100% of the rehab at some interest rate and points as well as other terms.