Hard money or Find deal first?

Question

Hey guys, I'm Alex and I'm new to these forums. My brief overview is I've been researching real estate investing for a few months and have believe I have found my starting point.

I want to start by flipping single family houses using hard money to generate cash for more flips and multifamily rentals, but am unsure the next step I should take.

Should I start calling hard money guys in my area (Denver, Colorado) to see how much I could get, or Find a deal and then call them?

Thanks in advance,

Alex

Chris Lopez · Answer

@Alexander Reed as others have pointed out, always get your financing figured out first!

Reach out to @Justin Cooper at Pine Financial. He's Denver based, invests himself, has connections, etc.

He's one of the presenters at the annual, Denver Investor Success Summit: https://www.biggerpockets.com/forums/521/topics/60...

It's a good place to learn and network w/o getting upsold nonsense!

If you go, let me know and we can say hi.

Matt Shields · Answer

Always arrange your lending first. You will know what your budget is and be ready to move fast. Good deals don't last.

As always, seek professional advice. Good luck!

Andrew Bourgeois · Answer

@Alexander Reed, having your lending lined up in advance is never a bad thing. As has been mentioned already, you know what you have available to you, and you can make sure to calculate your costs properly to ensure any deal you are looking at really works for you.

Additionally, reaching out and starting relationships with lenders now will help you identify what information you may not have realized you would need to get funding, (a lot of lenders do not lend to individuals, only corporations, like an LLC). Starting the lending and vetting process in advance can help you remove some of the time consuming, close delaying steps out of the way before you even find a property.

Lastly, you can still be looking for a property while talking to lenders, you are going to have to go through a lot of properties to find the one which works for you. If you do happen to find one quick, I have always been told a good deal will always find funding.

Good luck!

Brian H. · Answer

@Alexander Reed there are some forum threads on people's experiences with various hard money lenders. I am also in the process of finding some to speak with for flipping here in North Carolina.

This thread had a few suggestions.

Then you just want to get on the phone with them and get all the information on their products, rates, fees, timeline, etc.

Jeff Zinsmeister · Answer

Lending first. Are you planning to occupy first or is it going to be a true flip?

Kevin Grinstead · Answer

Hi Alexander, have the conversation with the lender so you know how much you need out of pocket and what price range will be good and the. Find a Realtor to help you find deals that will make sense based on your numbers.

Good luck and happy investing!

Bob Floss II · Answer

@Alexander Reed Have a conversation with a lender first, especially hard money lenders that are more relationship driven. You’ll need a ballpark for your terms to plug into your spreadsheet for analyzing deals.

Justin Cooper · Answer

Thanks for the mention @Chris Lopez!

Hi @Alexander Reed!

Yes, I am a local hard money lender and would be happy to jump on a 10-20 minute call to get you some info on hard money, get you pre-approved and see if we might be a good fit!

And I agree with most, better to have that quick conversation with a lender to make sure you are pursuing the right types of deals or price points etc before you get out there and spin your wheels making offers etc.

Hard money or Find deal first?

Most Popular Reply