Updated 27 days ago on .
π₯ Here are a few practical reminders on underwriting and deal structuring:
π₯ Here are a few practical reminders on underwriting and deal structuring:
π Start With the Numbers Know your ARV, rehab estimates, holding costs, and exit plan.If you're holding rental properties, understand your DCR (Debt Coverage Ratio) β most lenders want to see the deal can pay for itself.
π Funding Tools to Know:
- ποΈ EMD (Earnest Money Deposit): Be strategic β don't overextend, but show you're serious.
- π Gap Funding: Useful when youβre close but not quite there on closing day capital.
- βοΈ Transactional Funding: Ideal for double closes β temporary funding with no credit pull.
- π Short-Term Private Equity: For higher-cost flips or quick-turn projects, private equity can bridge the gap when traditional lending wonβt.
π€ Double Close vs. AssignmentsIf your spread is significant or you're protecting your position in the deal, a double close makes more sense than an assignment.
ποΈ Seller Financing = OptionsSometimes the best deals come from sellers willing to carry the note. Itβs not always about the lowest price β terms matter.
π Keep Your Paperwork & Process TightMessy contracts, vague timelines, or unclear communication = red flags. Run your deals like a business.
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