DFW - Best Local Banks & Credit Unions for Hard Money Refi!

13 Replies

Hello all,

I'm in the process of lining up financing before finding my first distressed property in Dallas, TX / DFW to invest in using the BRRRR strategy. It is KEY to know who you'll be refinancing with and their requirements before you ever sign up for a hard money loan. Can anyone provide a few suggestions on small, local banks and credit unions to use for the refinance out of hard money? With the suggestions, reasons why you like the lender would also be very much appreciated. Thanks in advance!

@Antonio Barnes

I have had borrowers who have had success with refi's through Guaranteed Rate Mortgage(@Andrew Postell ) and First Financial Bank (based out of Abilene but making more of a presence in DFW. Depending on how you want to qualify, any bank will allow you to refinance. If you are worried about qualifying for a mortgage, talk with Andrew first and he will help you out. He is active on these forums, and investor himself, and is very knowledgeable on the BRRRR strategy since it is his investing tool of choice.

@Antonio Barnes thanks for posting here.  Always great to see fellow Texans post.  And I agree with @Ryan Blake that First Financial Bank is very friendly for us (I've gotten loans through them myself) and even Longhorn Investments is a great place to find rehab loans too.  Have certainly used them as well.  Feel free to post any other questions. Here to help!

Originally posted by @Ryan Blake :

@Antonio Barnes

I have had borrowers who have had success with refi's through Guaranteed Rate Mortgage(@Andrew Postell ) and First Financial Bank (based out of Abilene but making more of a presence in DFW. Depending on how you want to qualify, any bank will allow you to refinance. If you are worried about qualifying for a mortgage, talk with Andrew first and he will help you out. He is active on these forums, and investor himself, and is very knowledgeable on the BRRRR strategy since it is his investing tool of choice.

I'm not worried about qualifying. I'm just trying to gather up some options between banks and credit unions to see the differences in their requirements and who I should use for refinancing out of hard money. I would love to chat for a moment though Andrew. This will be my first time talking with lenders, so any insight would be appreciated!

 

Originally posted by @Mark Clayton :

Hi! From my reading (I'm a total beginner), I assume that working with local banks for hard money loans would be the better option. However, I came across sites like http://fund.me/, and wanted to get thoughts on this option?

From my reading and research, it seems to just depend. Definitely want to do 'local and small' banks or credit unions. I just want to interview both options just to see how they compare.

I'm not familiar with that site. Has anyone used that?

 

@Antonio Barnes & @Mark Clayton local is 99% the answer. There are some good national lenders but they are so rare and hard to find that it's just easier to target local lenders. I acutally have written a list of questions you should be asking your lenders when you interview them. This is based on being a BRRRR type of investor:

Questions for Lenders

  1. When do you start using rental income to help me qualify? (the answer needs to be immediately)
  2. When do you start using “After Repair Value” on my property? (also needs to be immediately)
  3. How long do you need me to be on title to refinance? (this is important if you do need a short term loan to purchase then refinance out - and the answer should be 1 day...very important that it is 1 day on title is all that is needed to refinance)
  4. What is my minimum down payment required? (if they only require 15% down on a single family home that is usually a good sign that you are working with a flexible lender)
  5. How many loans can I have with you?
  6. Can I change title to my LLC?
  7. Do you sell your mortgages?
  8. What is your loan minimum?
  9. Can you explain to me what your reserve requirements are?
Originally posted by @Andrew Postell :

@Antonio Barnes & @Mark Clayton local is 99% the answer. There are some good national lenders but they are so rare and hard to find that it's just easier to target local lenders. I acutally have written a list of questions you should be asking your lenders when you interview them. This is based on being a BRRRR type of investor:

Questions for Lenders

  1. When do you start using rental income to help me qualify? (the answer needs to be immediately)
  2. When do you start using “After Repair Value” on my property? (also needs to be immediately)
  3. How long do you need me to be on title to refinance? (this is important if you do need a short term loan to purchase then refinance out - and the answer should be 1 day...very important that it is 1 day on title is all that is needed to refinance)
  4. What is my minimum down payment required? (if they only require 15% down on a single family home that is usually a good sign that you are working with a flexible lender)
  5. How many loans can I have with you?
  6. Can I change title to my LLC?
  7. Do you sell your mortgages?
  8. What is your loan minimum?
  9. Can you explain to me what your reserve requirements are?

These are fantastic and thanks for taking the time to write these up! I've read that some hard money lenders require as low as 10% down on a single family home, and fund 90% of the purchase price. I assume the difference between them lending 80% vs 90% depends on ARV? or just the overall deal put together and general flexibility of the lender?

@Mark Clayton the hard money lenders I work with don't require a downpayment if you buy and rehab at 75% or lower.  We try not to use any hard money lenders that require downpayments.  It keeps more cash in our pocket.  I hope this makes sense.