Guidance going to the Next Level - Private or Hard, Auction.com
Hello,
I have been investing in the Belleville IL area for about 4 years and have had reasonable success. I have accumulated 6 rental properties which are generating income, and done about 8 flips that sell in the 75 - 115k area, all cash.
I have my sights on a larger property on Auction.com I think will go for around 120k, would cost max 80k to rehab, and would sell for 300k - This is a bit too large for my 100k cash + 6k rental income business. Point is, I am trying to understand what type of financing to use - hard money? private money? and which source to use, I filled out a connected investors form and I get phone calls, the terms dont sound very good and its unclear how that would be lined up such that I could pay "cash" at an Auction.com closing.
I wish I had a mentor to guide me on transitioning into using financing so that I don't get a bad deal, but Ill settle for any BP advice folks can give. Thanks in advance!
Rob Campbell
Most Popular Reply
Auction.com and similar sites for certain purchases allow financing which is different then a sheriffs sale. I would always prefer a private money lender over hard money, but you have to connect with someone. I've met most of my private lenders at REIA meetings, meetups and other investor seminars and some here on BP. Private lending still has healthy interest 10%-12%, but your not paying the 3, 4 or 5 points.