Investor · Philadelphia, PA · Member since 2014 · 49 posts · 11 votes
I am in need of funding. I lost two properties already under contract and $10,000. I have 2 more under contract and they are solid, I just keep getting people who want more than I can part with to make the deal work. I'm not cheap I'll even go 50/50, but after anticipated repairs and holding costs I seriously will be net to net just over even.
Can anyone recommend someone who is looking for long term success with a reasonable decent guy? One that isn't looking for a grand slam out of my pockets.
I'd explain the deal but in a nutshell two properties $125k with an ARV conservatively from MLS $170k $10k repairs. Also $77k with $25k in repairs for an MLS comp of $160k. Anyone who can help it would be appreciated.
By the way I know a dozen hard money lenders that's my problem. I even know people brokering out hard money loans independently for hard money guys taking a cut.
Sounds like the hard money is your best option. They are expensive, but it puts you in the game. If they are great deals, wholesale them. I don't see many other options, as you have already found cash partners, and they are telling you what they need for the risk on your property, and you didn't like the terms. If you have 900k in properties that are unleveraged, look to a portfolio lender that will lend to an LLC, and not based on your personal credit.
Maybe time to sell one of those properties to free up some seed money.
Are you bringing a portion of the money to the table or looking for 100% of purchase and repairs ? I think that's going to be difficult for most that aren't true friends and family.
I do have between $40 -$60k. I am putting in. I realize the hurculean task ahead of me, but I'm just looking for a partner who understands the business. I also have $900k in property I can leverage and I obviously will make my partner first lean holder to make it as risk free as I can for them.
I'm a regular no BS guy. I'm a medical professional who has a healthy 6 figure income without the rents I collect monthly, but 7 children eat that salary up, and having been married 3 times I have a FICO of 2, so I can't get a loan for bubble gum. That's why I'm here. I need to find a way to pay for 7 college tuitions and 6 weddings, retirement and believe it or not surgery won't pay all of those bills. Time is ticking for this 46 y.o. guy. I need a partner.
Thanks for your input. I do consider those in the holding cost, also interest payments. I'm pretty confident in the deals I do because I understand my market well, I even include overruns in a 10-20% slush fund.
Sounds like the hard money is your best option. They are expensive, but it puts you in the game. If they are great deals, wholesale them. I don't see many other options, as you have already found cash partners, and they are telling you what they need for the risk on your property, and you didn't like the terms. If you have 900k in properties that are unleveraged, look to a portfolio lender that will lend to an LLC, and not based on your personal credit.
Maybe time to sell one of those properties to free up some seed money.
$40k is mine, $20k is a friends, $60k will not buy me a $75k house plus rehabbing cost. I can't even provide a POF letter with my total amount.
The $900k is all commercial properties and 3/4 of that are auto shops. For some reason which I don't understand 1. It is really difficult to leverage commercial property and 2. No one will deal with auto shops due to insurance regulations.
Find a mortgage broker and ask him/her to ask his lenders for a rehab loan for the After Repair Value (ARV) of the home. You could get up to 85% of the rehabbed value from what I understand.
I agree with@Account Closed in thinking you should be able to do both deals with what capital you have ($60k) + a HML loan. Not sure of the industry averages in PA, but here in CA 80% of the Purchase + 100% of the Rehab costs is not an uncommon Fix n Flip loan.... or in other words about a 65-70% ARV loan. That $60k should cover your borrower's balance.
Using 65%ARV as a standard max loan, that will gross you $215k for both properties, purchases + rehabs on both = $237k. Seems like this should work fine for you if you wanted to work with a HML.
Dude, give me a call. LendingHome is about to open in PA. I got 2pts and 8.5% on my last loan with them. I'd be up for a JV if the deals are right and I'm not covering everything, especially if I'm not dealing with contractors and you have other assets. I'd have to go up there some to check on things on the first few, of course, but I'm down for leveraging my funding in other markets if it makes sense.