All Forum Posts by: Joel Thompson

@Garrett T Stratton it is reoccuring. The next one will probably be early to mid June.

I'm with @Bill Goodland, I'd pass on this one unless you can get the property for $110k.

$220k ARV

$60k reno

shooting for 70% LTV - total loan $154k

$60k is reno, considering 20% down ($30,800) your purchase price cannot be over $124,800 (not considering points)

Hope this helps

@Daniel Kern if you own any of those 6 properties out right, ask if you can cross-collateralize one of them, could eliminate out of pocket costs.

Origination sounds right, maybe a little on the higher end. They should wrap it up in to the loan.

9% sounds right because your SREO includes at least 6 properties.

@Zach Jones if I'm running numbers using your high end:

PP + Reno = $220k

Assuming 20% down and 12% rate:

$44k down - $176k total loan value

Interest only payment - $1760/mon (worst case scenario HML charges interest on full loan amount including reno from day 1)

Assuming 3 months from purchase to refi to conventional

$49,280 cash out of pocket and $176k paid out to HML upon refi.

If you are able to refi $195k, then you'll have to leave $30,280 in the property.

@Brian Garrett is right, this one is too tight.

@Tim Emery based on the purpose of the post, looks like @Travis Sperr hit the nail on the head.

In this scenario, since 20% interest and 4 points "works", is the only option for a solid deal, and 10% down is less than $100k, you're making a better return on your money than if you were to put $200k in and $100k. Provided that net profit over cash invested is the metric you're focused on.

If the best offer someone could get is 20% interest and 4 points on a loan, they should probably think twice about doing the deal though. Usually rates like that would mean that the lender is seeing something that makes lending extremely risky.

@Kelvin Letron Brantley like @Chris Mason said, most HML will look at your credit simply to determine the risk of missing payments.

By nature, hard money loans are asset based. Private funding could also be secured and very rarely will they have the means to check credit.

@Jo-Ann Lapin I agree, fortunately @Dae’Leon Flucas was just over estimating the interest rate so he would not come in over budget on that component he wasn't familiar with.

@Charles Soper you stole the words from me! Local REIA, BP, Meet-Up, etc. events are a great place to meet local HMLs. I always recommend working with someone in the area you're going to be investing because they can provide a valuable second set of eyes to help you evaluate a deal you're looking at.

@Dae’Leon Flucas I work with investors in Washington & Oregon so I'd be happy to help if that's where you're considering investing. If not, I can help you connect with someone, or if you go to Network > Companies on the Menu bar at the top of the page you can find lots of HMLs there.

@Frankie Betancourt when the year is up that $50,000 is due, in this scenario you would already have paid that $6,000 in interest over the last 12 months.

If you do not agree on an extension or pay then the lender would foreclose.

@Frankie Betancourt you're right on point. If you got a 12 month loan for $50,000 you'd pay back $50,000 plus the interest.

Like @Taylor L. said, you're typically paying interest only every month, so if you had a $50,000 loan for 12 months, and the interest rate was 12%, you'd pay a $500/month interest payment.