All Forum Posts by: Kevin Woodard

I can't imagine setting up the LLC is that time consuming (just did one it took less than 24 hours without paying an expediting fee). Consumer loans are subject to a lot more regulation compared to a loan to an entity, so I would say the vast majority do limiting who you can work with (this may cost you more than a few hundred dollars).

Yes there are hard money lender that will lend up to 75% ARV and will finance the entire deal to include closing costs.

The term is typically limited to 6 months and you will have to extend if you can’t exit within this time line. Just some food for thought.

What market are you in?

I think it would be worth shopping around. If you're putting that in your personal name especially. Things change but at par rate (no points) I have a deal closing just under 7 (6.9375%). 75% LTV and 1.1 DSCR.

Hope this puts things into perspective.

@Burt L. this is definitely one of the factors you will need to discuss with your lender, as it depends. 
Some sources will allow for 100% of proceeds, others will allow for 10% of proceeds to count towards liquidity reserves. 
Outside of that usually large deposits anywhere from $20,000-$50,000+ (lender dependent) may require a letter of explanation. 

If you have any questions or need templates feel free to reach out. 

Similar to what @Lyndsay Zwirlein recommended, call your local credit unions. They are usually pretty helpful with these types of loans and like to build out the local community. 

Alternatively, if they are undervalued properties that need some TLC you could go that route and force the appreciation.

Hope this helps!

The bigger question is do you need the cash and are you looking to increase COC returns now? If the answer is yes then delayed financing would be your best bet and delayed financing will utilize purchase price, if you are looking to include rehab you will need a product that does just that.

You could go delayed financing with a fix & hold-type loan that funds 100% of construction, then refinance after rehab using the $140,000 ARV (75% LTV). This maximizes cash on hand, which could be useful in the coming months, and increases COC.

Hope this helps, who did you serve with by the way?

Semper Fi

If the total project cost to ARV is under 65% ARV 100% financing may be an option if you find a private lender. The exit strategy may have some lenders weary so I would also talk to long term lenders to get an idea of what the back up plan is if you need to hold. Otherwise, you could bridge the deal for 2 years. If that's the case you won't need an equity partner.

There shouldn't be an issue with two leases as long as it's legal two units. In that case, depending on time, I would find a new lender. 

I would avoid the taxable event all together and keep the cash flow. The cash you get out you can reinvest. 

Congrats on the deal!