Let's talk about liquidity shall we?

Recently I have had a number of clients apply for their loans who do not have the liquidity necessary to be approved. Most lenders will require you to have anywhere from 3 to 6 months of Principal, Interest, and the equivalency of the  1st draw of the rehab loan.

This means that if your payments are $900.00 a month you should have 6 months of that payment plus a portion of rehab. If your rehab loan is $30,000.00 in 5 draws you will need to have the first $6,000.00 in reserves of which you will be reimbursed with the first draw upon inspection.

You will be asked to submit your tax returns usually for the last 2-3 years and the last 3 months of your bank statements for your entity and personally in some cases. You also will be asked to provide a statement of experience and any real estate currently owned.