Find money for down payment
Hello guys , I have another question, do hard money lenders borrow money for down payments? what are some of the way that do you guys use to get all the money that you need for the down payment?
Quote from @Javier Mercado:
There aren't any lenders giving out money for down payment. The only way to bridge the equity gap is to come up with the cash yourself or use OPM (other people's money). Your own personal circle of influence would be a good start if you have a deal.
But there's a crucial piece needed to be successful... know the numbers and have multiple exits... Using other people's money is a big responsibility. Especially with friends and family, a bad deal can cause tension on your relationship. It's important to approach this as a business and explain your plan in great detail anticipating any concerns with a contingency plan already in place. Like any investment there are risks and your investors will need to understand that. If you have a good deal and provide a good return in a predetermined time frame, I'm sure it wont be the last deal they help with.
Eventually you'll do it enough where you will have the capital and wont need OPM. By then if you're successful enough, they'll want to proactively invest in your deals because you make them money! It isn't for the faint of heart but if you keep a narrow focus on your buy box and know your numbers, it'll give you the confidence you need to take the next step.
There are hard money lenders that are more lenient on the source of funds. They mostly care about the deal. If there's enough skin in the game and it's a solid deal, hard money lenders will back you. So in short. . . you can either raise the money, or save the money yourself.
Thank you so much , I have been working in that as well in the strategy. Thank you again.