Recommendations for a Hard Money Lender for a Newbie.

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John Mocker
Insurance Agent · Norwalk, CT · Member since 2016 · 2k+ posts · 1k+ votes
4y

Tasha,

One thing to consider, as a New Investor, the knowlege of the Hard money Lender may be of more value than the lowest rate.  I have had several of my clients say they used their particular hard money lender as deal double check.   If that lender declined funding the deal they took it as a warning that maybe they did not run the numbers right, were too risky, etc.

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  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    4y
    Quote from @Tasha Barnes:

    Hey BP Fam,

    Can anyone recommend a good hard money lender for a rehab project? I'm fairly "green" when it comes to rehabbing. 

    Thank you.

    Tasha


    Lima one 

    Kavi 

    Lending one..

    these 3 have very transparent fee structures you can view on line..  where they will indicate what experience level is required and what the rates and terms will be that match's your experience level.  With LIma one being a N. Carolina based company.
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  • Lien VuongBusiness Member
    Real Estate Agent · Boston, MA · Member since 2018 · 2k+ posts · 1k+ votes
    4y

    What markets are you targeting, typically they're area specific. 

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  • Tasha Barnes
    OP
    Rental Property Investor · Charlotte, NC · Member since 2016 · 47 posts · 16 votes
    4y
    Quote from @Jay Hinrichs:
    Quote from @Tasha Barnes:

    Hey BP Fam,

    Can anyone recommend a good hard money lender for a rehab project? I'm fairly "green" when it comes to rehabbing. 

    Thank you.

    Tasha


    Lima one 

    Kavi 

    Lending one..

    these 3 have very transparent fee structures you can view on line..  where they will indicate what experience level is required and what the rates and terms will be that match's your experience level.  With LIma one being a N. Carolina based company.

     Awesome! Thank you:-)

    0Reply
  • Tasha Barnes
    OP
    Rental Property Investor · Charlotte, NC · Member since 2016 · 47 posts · 16 votes
    4y
    Quote from @Lien Vuong:

    What markets are you targeting, typically they're area specific. 


     This particular property that I'm looking at is in High Point, NC!

    Tasha 

    0Reply
  • Ryan Deasy
    Lender · Farmington, CT · Member since 2015 · 542 posts · 321 votes
    4y

    @Tasha Barnes

    when i got started in real estate investing, i had a HML really teach me the ropes and it was super helpful. i ended up using him a ton on deals in the future. i now am doing some loans under him. i would be happy to answer any questions you have and quote any deals you come across.

    0Reply
  • Pam I.
    Rental Property Investor · Arlington, VA · Member since 2016 · 24 posts · 16 votes
    4y

    @Tasha Barnes 

    While doing my research, I came across Kram Capital. I haven't used them personally. But, looking at their website they have a variety of funding options.  

    0Reply
  • George DespotopoulosBusiness Member
    Lender · New York, NY · Member since 2016 · 936 posts · 287 votes
    4y

    @Tasha Barnes I would go to BiggerPockets's NETWORK tab at the top of the page and look at the Hard Money Lender directory under the recommended vendors. You can then search by state. If you search by North Carolina you can view a bunch of different hard money lenders there and get some more info about them. Some may also have reviews from other BiggerPockets users. 

    For your first one, I'd expect to put down 20-25% and received 100% of the rehab funds as long as you have a 680+ credit score. It's important that you have at least 20-25% + around 10% of the reahb funds + 3-6 months of loan payments in liquid assets in reserves. As long as you meet that liquidity requirement, your credit score is good, and the deal's numbers are solid then you should be able to get a good quote on a 12 month loan term (with no prepayment penalty). 

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  • Chris Tarpey
    Investor · Jacksonville, NC · Member since 2018 · 193 posts · 107 votes
    4y

    We use Lima One! We have a great referral over there Id be happy to put you in touch with!

    0Reply
  • Account Closed
    Denver, CO · Member since 2018 · 127 posts · 97 votes
    4y

    @Tasha Barnes I manage our relationships with Hard Money Lenders on BiggerPockets and would be glad to help. The HML Directory is a great place to start. 

    George from Mofin (above) serves North Carolina. He is not one to brag in the forums but I can share that he has one of the highest ratings of all of the Hard Money Lenders on BiggerPockets and is a great resource to learn from! 

    1Reply
  • Mike Klarman
    Specialist · NJ · Member since 2022 · 1k+ posts · 649 votes
    4y

    Tasha, just be ready to put down 20%, pay 2 points on total loan amount, pay hard closing costs, pay for title work, insurance, and then you have the holding costs.  Most require three payments be made but all have a no pre-pay penalty and are interest only loans.  As a newbie be ready to pay 12%.  That's 1k/month for every 100k you borrow.  So if your total loan amount is 150k let's say then you'll pay 1,500/month in holding costs, 3 payments min so that's 4,500 in holding costs maybe 6k if you go 4 months.

    So just to buy a distressed property for 100k and put 75k in it and hope to get 225k when you're done, you will need to float 35k.  And if that's about all you are working with and you have a choice to refi and hold or flip and do more deals, I say flip and do more deals.  If you can get in, get that first flip done - which will have he absolute worst terms - and now you are richer and wiser and ready for deal 2 which should have better terms and then the third even better, and by the time you get to 10 you've made 250k in profit if your avg take was 25k and you are now a 10 experience and you can get 90% of any purchase and 100% of any rehab.  While you have your flipping networks set-up you now have nice capital to deploy into quality, appreciating, cash flow producing real estate like multi fam buildings, luxury SFHs in resort areas.  You can afford these deals now because you were patient and set up a network of short-term income that provided money and experience and now you can do deals on that next level.

    0Reply
  • Michael Kinsella
    Lender · Member since 2018 · 617 posts · 275 votes
    4y

    @Tasha Barnes

    Two good starting points...

    1. Network --> Hard Money Lenders tab on BiggerPockets where you can filter by state.

    2. Local REIA events where you can network with other investors to get referrals and also meet local HML reps.

    As a newbie, you will need to turn over more stones, i.e. speak with more lenders, to find financing options.

    0Reply
  • Bob S.
    Real Estate Consultant · Cleveland · Member since 2020 · 6k+ posts · 3k+ votes
    4y
    Quote from @Tasha Barnes:

    Hey BP Fam,

    Can anyone recommend a good hard money lender for a rehab project? I'm fairly "green" when it comes to rehabbing. 

    Thank you.

    Tashai 

    I tell it like it is. You have no experience, IMO you are not going to get anyone to lend you money unless you put down at least 50%. I know I would not lend under any other circumstance. I suggest you simply flip your contract , make a fee, learn save then go on your own. Do you know anything about rehab? I assume no. that too is a big issue. 

    I wish you all the best 

    1Reply
  • Aj Parikh
    Rental Property Investor · Centreville, VA · Member since 2019 · 1k+ posts · 799 votes
    4y

    Hi there, I can connect you with my contact for hard money lending here in Northern Virginia. But I would suggest you reach out to some of the family or friends who would be willing to lend you money at 8-9% interest rate. Because closing costs are generally high with hard money lenders. Feel free to reach out

    0Reply
  • Bob ReinhardBusiness Member
    Lender · Patterson, NY · Member since 2017 · 488 posts · 186 votes
    4y
    It's like snowflakes. No two lenders are alike, but they are all fairly similar

    All above make a valid point. Only you know what you have on hand as cash to start the deal. By the way, no borrowing the cash and the expect a loan on top.

    Reach out to discuss by phone if you'd like. Often NC/ SC involved.

    Bob
    [email protected]914-861-5501
    0Reply
  • John Mocker
    Insurance Agent · Norwalk, CT · Member since 2016 · 2k+ posts · 1k+ votes
    4y

    Tasha,

    One thing to consider, as a New Investor, the knowlege of the Hard money Lender may be of more value than the lowest rate.  I have had several of my clients say they used their particular hard money lender as deal double check.   If that lender declined funding the deal they took it as a warning that maybe they did not run the numbers right, were too risky, etc.

    2Reply
  • Tasha Barnes
    OP
    Rental Property Investor · Charlotte, NC · Member since 2016 · 47 posts · 16 votes
    4y
    Quote from @Chris Tarpey:

    We use Lima One! We have a great referral over there Id be happy to put you in touch with!


     Hello, do you mind putting me in connecting me with your contact at LimaOne? I was in conversation with representative there but the response haven't been the greatest. I would like to move forward with them because I've heard great reviews. 

    Thank you, 

    0Reply
  • Tasha Barnes
    OP
    Rental Property Investor · Charlotte, NC · Member since 2016 · 47 posts · 16 votes
    4y
    Quote from @John Mocker:

    Tasha,

    One thing to consider, as a New Investor, the knowlege of the Hard money Lender may be of more value than the lowest rate.  I have had several of my clients say they used their particular hard money lender as deal double check.   If that lender declined funding the deal they took it as a warning that maybe they did not run the numbers right, were too risky, etc.


     Great insight! Thank you!

    0Reply
  • Rodrigo Molina
    Member since 2022 · 2 posts · 0 votes
    4y
    Quote from @George Despotopoulos:

    @Tasha Barnes I would go to BiggerPockets's NETWORK tab at the top of the page and look at the Hard Money Lender directory under the recommended vendors. You can then search by state. If you search by North Carolina you can view a bunch of different hard money lenders there and get some more info about them. Some may also have reviews from other BiggerPockets users. 

    For your first one, I'd expect to put down 20-25% and received 100% of the rehab funds as long as you have a 680+ credit score. It's important that you have at least 20-25% + around 10% of the reahb funds + 3-6 months of loan payments in liquid assets in reserves. As long as you meet that liquidity requirement, your credit score is good, and the deal's numbers are solid then you should be able to get a good quote on a 12 month loan term (with no prepayment penalty). 

    How can one find the liquidity? I dont have 20% available for a house I’m trying to flip
    0Reply
  • Karen Plyler
    Member since 2019 · 4 posts · 1 vote
    4y

    @Tasha Barnes Great question! I know that I am late to this party and I see that you have gotten quite a bit of great information. I am not sure if you are like me some of the information can be overwhelming. I am not a direct lender; however, I have access to multiple hard money lenders by being a broker. I do agree, that right now may have to put up 20% down. I hope this is not discouraging. 

    I am not a veteran in this arena; however, I work hard for my clients. The one thing that I pride myself on is working hard to place my clients with the best lender that will get them most, if not all of the things on their wish list. I also try to share/educate throughout the process. I also try to look at all different scenarios and options. I cannot promise you a guaranteed loan of course; however, I do promise to be your advocate and find you the best options. 

    If you would like to talk more, contact me. 

    0Reply
  • Kai Kopsch
    Real Estate Broker · Charlotte, NC · Member since 2016 · 569 posts · 351 votes
    4y

    @Tasha Barnes, this sounds perhaps hard, but if you need help finding a good hard money lender is a red flag. This indicates that you don't have your team in place, and without your success rate isn't the best. I would recommend doing your first few transactions together with a seasoned investor after a few deals, you have a team you can trust, and a hard money lender will approach you. 

    0Reply
  • Calvin M Harris
    Wholesaler · Member since 2022 · 18 posts · 1 vote
    4y

    Hi Tasha

    I have access to private funding including hard money loans from a company called Ideal Funding Group.  The lend nationwide.  I'm just down the road in Winnsboro, SC.

    0Reply
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