All Forum Posts by: Ariel Salvaro

Chris, happy to help! And good on you for being proactive, and reaching out to the company - based on the situation, it sounds like you might have a motivated seller, let us know how it goes! 

@James Silva Brown, absolutely, happy to help! I sent you a PM. 

@Account Closed, thank you! 

I don't come to Texas often, but definitely want to change that over the next year or two!

Hi Chris, 

I am happy to see a real estate investor from my own local community! 

Everything @George Taylor said from the HML perspective stands.

To be on the conservative side of things, I would personally suggest planning on a 70% LTV ratio, the way BiggerPockets guide suggests it - there are almost always some unexpected surprises along the way (big or small), and it's better to have a little bit of that extra cushion for when they arise.

Choosing the best HML for you is best done by shopping around - BP has a list of HMLs serving Virginia (we are among them, I am happy to make an introduction to our team).

Regarding your contractor situation, I think the approach @Stephanie P. suggests is more standard, so I guess it ultimately depends on whether you think you would profit more in your flip than you would pay in the extra loan amount if you don't include the contractor as partner vs. including the contractor in with his 19%, and having 19% less of the loan to repay, but also getting 19% of the final profit. 

Hi Hudson, 

To reply to your questions, 

1. Yes, there are definitely HMLs that would work with less experienced investors - the more important question for an HML is whether you found a really good deal that you can successfully flip within a relatively short time period (6-12 months). Some HMLs also offer education for new investors on how to find the best properties to flip, and what a lender would look at when evaluating a property vs. what an investor looks at (e.g. lenders are generally more conservative with comps, and will look at the lowest comps instead of the highest ones in order to evaluate the worst case scenario for flipping).

2. Yes, depending on your credit score, you would be able to put 5-10% down - in fact, e.g. we do up to 100% financing for our clients. 

3. Yes, it's also possible to get rehab financing, e.g. your 40k to fix things up, depending on what the rehab includes - the exact list would have to be discussed with your HML, as sometimes investors upgrade properties with more advanced amenities than are necessary to flip the property, and the HML, or a more experienced REI member will know more about this than someone starting out.

Regarding HMLs, I know we also cover Chicago, and are a rare HML that provides up to 100% financing. Shoot me a PM, and I am happy to make an introduction!

This sounds like a scenario that requires consulting with an attorney!

Thank you @Dave Visaya, and absolutely, looking forward to connecting with all REI colleagues interested in hard money loans!

Also, I would love to connect with people working in big data within the RE markets! 

Lots of good points here! 

I would add that working with a hard money lender may be advantageous to working with private money when you are not an expert in REI, because an HML will only fund a deal they know has a good chance of succeeding, whereas some private money may accept a deal you tell them is good, but then if you miscalculated things can get very awkward very fast, especially if you have a strong personal relationship with your private money provider (e.g. if they are a close friend, or a family member).

Hi Tom, 
It will be difficult getting an HML to fund a deal like this, because it sounds like a difficult property to flip, which is what most hard money loans are for. If you want to go the hard money route, you would need to present a plan of how you intend on repaying the loan back in short time (usually 6-12 months).

The interest may also be higher than what you pay on a USDA loan.