Financing a rehab with 3 friends

9 Replies

3 friends and I are flipping a house in south central PA and we are exploring ways to finance the rehab. We are buying the house with cash for 60k but need to finance the rehab which we estimate to be around 80k. We estimate the ARV at 225k and the rehab to take 4 months. Suggestions for the best way to finance the rehab between 4 people?

If you get a commercial loan you can get the rehab financed. I got a quote for a commercial loan yesterday for under 6 percent interest. How about a 203k loan? There is so much meat on that deal that you could use hard money.

Originally posted by @Stephen Kehoe :

If you get a commercial loan you can get the rehab financed. I got a quote for a commercial loan yesterday for under 6 percent interest. How about a 203k loan? There is so much meat on that deal that you could use hard money. 

Thanks for the advice Stephen! Do you have any recommendations for a hard money lender in the Baltimore area?

For that area the only ones I would know are the national lenders. Let's see if the keyword alerts for Cumberland or Harrisburg brings in anyone with local knowledge. 

Do you have a signed partnership agreement with all? I wouldn't move 5 feet forward without that. 

@Matthew Shultis

Hard money or private money.

But if 4 people can’t come up with $80k then that’s a huge red flag...

Not to mention a 4 way partnership sounds like a disaster waiting to happen...