Mezzanine Funding, Second Position Lender, or JV Funding

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Mezzanine Funding, Second Position Lender, or JV Funding

John C.
Member since 2018 · 50 posts · 39 votes

I own 90 buildings in PA, 135 long term rentals and 4 short term rentals. I and am seeking to expand my short term rental portfolio. I have dscr lenders I work with, looking to purchase around 500k properties in Poconos, Jersey Shore or Englewood Florida. My challenge is coming up with the $150k or so deposit or closing costs per house to scale quickly. I've heard that Mezzanine Funding, Second Position Lender, and JV Funding are difficult to find. Can anyone help me out?

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  • Marty JohnstonPro Member
    Lender · Wauwatosa, WI · Member since 2016 · 571 posts · 204 votes
    3y

    Hey John, on these it sounds like this is all turnkey properties, is that right? I do offer gap funding for investors, but it generally only pencils out well for short term capital with rehabbers (both BRRRR or flippers) and developers as they can continue to re-cycle the capital into the next deals, but it eats away pretty quickly on rental properties for cashflow.

    If any of these are BRRRR deals or something that would cashflow on unsecured debt at 5-7 years fully amortizing terms, it might be a fit. Otherwise I'l defer to the rest of the forum for JV / Equity and/or other lower cost financing options here.

    [email protected]414-600-0123
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  • Chris SeveneyBusiness Member
    Moderator
    Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
    3y

    @John C. I would say they are not difficult to find if you have significant equity but be prepared to pay through the nose.

    Mezzanine / non-senior liens on commercial debt is easily double digits today.

    Have you considered bringing on a partner ?

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  • John C.
    OP
    Member since 2018 · 50 posts · 39 votes
    3y

    @Chris Seveney thank you. I've thought about partners, not sure where to find one

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